There are many common misconceptions about declaring bankruptcy in Arizona. Those people considering bankruptcy often have similar questions that stem from the misunderstanding they will be forced into giving up everything they have in order to pay off their debts. Declaring bankruptcy can actually protect some of your most valuable assets and provide you an affordable path to a fresh start. It’s not a simple solution, but declaring bankruptcy in Arizona can be the best path forward for some individuals and companies with unsustainable debt payments.
Common Misconceptions About Bankruptcy Law in Arizona
The most common misconception about bankruptcy is that it is only an option when you’ve completely run out of money and you will lose all your assets as a part of the process. While you certainly might have to sell some assets as part of a bankruptcy plan, the state of Arizona allows you to keep up to $150,000 of equity in your home and $5,000 equity in your car. These can certainly vary by situation and final bankruptcy plans, but you will likely keep your mortgage and car payments exactly the same in Chapter 7 Bankruptcy and those payments will be included in most Chapter 13 Bankruptcy plans in Arizona.
One of the final motivating factors that push an individual towards bankruptcy is often avoiding or stopping the foreclosure process. While bankruptcy can help delay a potential foreclosure, it’s important to understand you are much more likely to avoid foreclosure if you do not wait to pursue bankruptcy protection until you are facing foreclosure.
Many people also mistakenly believe that bankruptcy can simply remove all their debts. You might be able to have some unsecured debts and liabilities eliminated during the bankruptcy process. However, it is far more often that your debt will collectively be restructured into more manageable payments based on your income and available assets. Bankruptcy plans in Arizona are meant to provide a path forward and protection from going completely broke, but you will still be responsible for some portion of most of your existing debts.
Another common misconception is that bankruptcy is an easy process that just involves filing some paperwork and you can have a bunch of debt eliminated. It is vital to understand that bankruptcy is a complicated and time consuming process that requires a thorough understanding of the available options. The process requires an understanding of what bankruptcy plan will be best for your situation and will be most likely to be approved by creditors and the court. Finally, you need a plan that you or your business will be able to afford and complete. It will only cause more issues if you accept a bankruptcy plan and cannot complete the payments.
Questions About Bankruptcy Law in Arizona
There are some questions that most people considering bankruptcy have about the process and requirements. One of the most common is whether declaring bankruptcy will wipe out all debts. While you might be able to remove some unsecured debts, you are likely to have many current debts and liabilities reduced and restructured. As mentioned above, you are able to keep equity in your home and car when you file for bankruptcy in Arizona. This also means that you will need to keep paying those debts as part of your bankruptcy plan.
It is common for people that are trying to be proactive about their financial planning to think that bankruptcy is not an option until they’ve fallen behind on their payments. However, you do not have to be delinquent on a single debt payment or liability in order to pursue bankruptcy. If you are barely getting your payments made and see that any unexpected costs will likely make your debts unsustainable, then you can absolutely pursue bankruptcy before you fall behind on your payments. Being proactive in this situation and working with an experienced bankruptcy attorney will make the process much easier to handle.
Many people declaring bankruptcy also look to cut costs by pursuing the process themselves or asking about how much of the process they can handle without an attorney to save money. Few people are able to successfully negotiate the entire process of declaring bankruptcy without the assistance of an experienced bankruptcy attorney in Arizona. The process of filing for bankruptcy in Arizona is complicated and it’s vital to determine the best path based on your income, assets and overall situation. You are significantly more likely to achieve a successful bankruptcy plan that gets approved by all creditors, the court, and one that actually gives you a path to a fresh start when you are represented by an attorney that has helped many clients through the complex process.
Find the Best Plan with an Experienced Bankruptcy Attorney in Arizona
The attorneys at RSN Law have helped our clients find a fresh start to their financial situation with a bankruptcy plan suitable for their situation. Whether you are looking for help with individual finances or your business, our firm can assess your current financial situation, craft a bankruptcy plan, guide you through the filing process, handle the meeting of the creditors, and see the process through to an acceptance of your bankruptcy plan. You don’t have to wait until you’ve fallen behind on your payments. Our firm can help you be proactive in finding a solution before you risk losing your most important assets and create a sustainable path forward. Contact RSN Law today at 480-712-0035 to review if bankruptcy is the best option for you or make an appointment on our contact us page.
RSN Law intends this article to be for informational purposes, not to be relief on a specific legal matter, and does not create an attorney-client relationship.