What is the difference between a Chapter 7 and Chapter 13 Bankruptcy?
What is the Means Test?
What is the Median Income in Arizona?
How much does it cost to file for bankruptcy?
Do I need a lawyer to file for bankruptcy?
Can I hire a document preparer instead of an attorney?
Can I keep my house if I file for bankruptcy?
Can I keep my car if I file for bankruptcy?
Will filing for bankruptcy stop a foreclosure, lawsuit, garnishment or debt collection?
What is a discharge?
Can I discharge my student loan in bankruptcy?
Can I discharge my medical bills?
Can I voluntarily repay my debts that were discharged in bankruptcy?
How long will a bankruptcy stay on my credit report?
A person (or company) who owes me money has filed for bankruptcy. What should I do?
What is a preference or preferential transfer?
My customer paid me for services/goods and later filed for bankruptcy. The trustee is now requesting that I return the payment. What should I do?
What is the difference between a Chapter 7 and Chapter 13 Bankruptcy?
Chapter 7 Bankruptcy is a "liquidation" bankruptcy. In Chapter 7, the debtor keeps certain assets that are exempt (certain equity in the house and car, furniture, etc.). The remaining (non-exempt) assets, if any, are sold by the bankruptcy trustee and the proceeds are distributed to the creditors. Individuals, corporations and partnerships may file a Chapter 7 bankruptcy.
Chapter 13 Bankruptcy is repayment of certain debts over a period of 3 or 5 years. In Chapter 13, the debtor prepares a plan in which he/she agrees to pay a certain portion of the future income to the bankruptcy trustee for payment to the creditors. Only individuals with regular income that owe unsecured debts of less than $336,900 and secured debt of less than $1,010,650 may file a Chapter 13 bankruptcy.
What is the Means Test?
The Means Test is a formula that determines whether a person (whose debts are primarily consumer debts) may file a Chapter 7 bankruptcy or if he or she has to file a Chapter 13 bankruptcy. Basically, Chapter 7 bankruptcy can be challenged if the debtor can pay $100 per month to their unsecured creditors.
What is the Median Income in Arizona?
For the purposes of means testing for bankruptcy cases filed after March 17, 2008, the median income in Arizona is $40,945 (one earner), $53,153 (family of two), $59,782 (family of three), and $66,903 (family of four). Add $6,900 more for each individual in excess of four people.
How much does it cost to file for bankruptcy?
The court filing fees are $299 (Chapter 7), $274 (Chapter 13) and $1,039 (Chapter 11). Prior to filing, individuals need to complete a credit counseling course and prior to receiving a discharge in Chapter 7 or 13 individuals need to complete a personal financial management course. The cost for those two courses is approximately $100. In addition, you should consider hiring an attorney. In today's complicated bankruptcy process, hiring a competent bankruptcy attorney will increase your chances of completing the process successfully.
Do I need a lawyer to file for bankruptcy?
You can file bankruptcy without hiring a lawyer, but you will be held to the same standard by the bankruptcy judge as if you are represented by a lawyer. Therefore, you need to comply with all of the legal requirements, rules and deadlines. It is very difficult to complete the bankruptcy case successfully without the assistance of a competent bankruptcy attorney. If you need an experienced bankruptcy lawyer for any bankruptcy matter, contact the Juras Law Firm, PLC, in Scottsdale, Arizona, at (480) 425-2009 .
Can I hire a document preparer instead of an attorney?
In Arizona, all of the document preparers must be certified. They are only permitted to provide you with general information and forms. They can't give you any legal advice, opinion, recommendation about your legal rights, defenses and strategies. For example, they are not allowed to assist you with a strategy for protecting your assets; they can't give you an opinion whether or not you will be able to keep your house in bankruptcy, etc. Only a licensed attorney can give you legal advice. All the document preparers can do is to take your information and fill out the forms. Many people have lost their houses, cars and other assets due to using document preparers. Hiring a document preparer is strongly discouraged.
Can I keep my house if I file for bankruptcy?
In Chapter 13 bankruptcy, you will probably be able to keep your house if you stay current on your mortgage payments. In Chapter 7 bankruptcy, it depends on the value of your house. You can keep certain exempt equity in your house the value of which depends on the state where you live (or you recently lived). In Arizona, you can exempt $150,000 equity in your house. However, if you bought your house within 1215 days (approx. 3.3 years) prior to filing for bankruptcy, only your equity in the amount of $136,875 can be exempt.
Can I keep my car if I file for bankruptcy?
In Chapter 13 bankruptcy, you will probably be able to keep your car (with exception for luxurious car) if you stay current on your car payments. In Chapter 7 bankruptcy, it depends on the value of your car and the state where you live.
Will filing for bankruptcy stop a foreclosure, lawsuit, garnishment or debt collection?
The filing of a bankruptcy petition will automatically stop most lawsuits, foreclosures, garnishments and collection activity. It is called an "automatic stay." However, certain lawsuits, proceedings and actions, such as criminal actions, proceedings concerning child custody, visitation rights, divorce (with the exception of division of the property), are not stopped. If you have filed a personal Chapter 7, 11 or 13 bankruptcy and your case was dismissed within the year before the petition, the automatic stay is limited.
What is a discharge?
A discharge is the court order stating the debtor does not have to pay his or her debts owed to creditors that were included in the bankruptcy.
Can I discharge my student loan in bankruptcy?
Student loans made or insured by nonprofit institutions, governmental units and qualified education loans are non-dischargeable unless the borrower can prove undue hardship.
Can I discharge my medical bills?
Medical bills are generally dischargeable with certain exceptions.
Can I voluntarily repay my debts that were discharged in bankruptcy?
Yes, you can voluntarily repay discharged debts.
How long will a bankruptcy stay on my credit report?
The law requires that credit reporting agencies may not report a bankruptcy on a credit report after ten years from the filing date.
A person (or company) owes me money and filed for bankruptcy. What should I do?
You should file a claim with the bankruptcy court showing the amount of debt. You should review the bankruptcy schedules filed with the court. In order to protect you rights it is recommended you consult with a bankruptcy attorney.
What is a preference or preferential transfer?
Certain payments made by the debtor within 90 days (or 1 year, if the payment was made to an insider) prior to filing for bankruptcy, can be avoided by the bankruptcy trustee. The trustee can demand that you pay back certain payments you received within 90 days (or 1 year) prior to someone's bankruptcy filing. You will then share proportionally any payments, if any, with other creditors. If you received a trustee's demand letter, contact a competent bankruptcy lawyer because there might be defenses to the trustee's preference action. If you need to talk with an experienced bankruptcy lawyer, contact the Juras Law Firm, PLC, in Scottsdale, Arizona, at (480) 425-2009 .
My customer paid me for services/goods and then filed for bankruptcy. The trustee is now requesting that I return the payment. What should I do?
You should contact a competent bankruptcy attorney to determine whether or not there are defenses to the trustee's preference action. If you would like to discuss your defenses to a preference action with an experienced bankruptcy attorney, contact the Juras Law Firm, PLC, in Scottsdale, Arizona, at (480) 425-2009 .
