Is Bankruptcy Law Difficult?
We know that the line, “Bankruptcy should be hard,” is not something anyone who is suffering through financial hardship wants to hear. However, we want you to consider the reasons that bankruptcy is not an easy process:
- Bankruptcy cannot become something that is so easy that people do not think twice before taking on too much debt.
- Creditors should be able to recoup as much as possible on the amounts they are owed.
- If everyone who had debt filed for bankruptcy, the entire system of credit would likely collapse and inhibit economic growth.
There are many reasons that people find themselves in a situation in which bankruptcy is an option and it is not always because of irresponsible spending behavior.
- A person could be going through an unexpected divorce in which their assets are significantly altered as a result.
- They could be laid off from their job, something that can happen to people at all income levels.
- Major and unexpected medical expenses are a common reality for many people.
- External political decisions can cause companies to go out of business or disrupt their customer base.
The list of reasons why people face insurmountable debt problems goes on, but luckily there are options. Both Chapter 7 and Chapter 13 bankruptcy can help individuals get back on track financially.
Making The Right Choices
We need to say that this is not a decision you need to consider on your own. Talk to your family and friends about your options. More importantly, securing the advice of a qualified Arizona bankruptcy attorney is vital. A bankruptcy attorney can help you determine whether or not you need to even file and help you figure out which type of bankruptcy you qualify for.
For both Chapter 7 and Chapter 13, a person is looking for a way to get their debts under control or discharged. Chapter 7 is the most common type and is usually the best option for people who do not have a regular income. With this type of bankruptcy, most of a person’s assets (with some exemptions for vital possessions) will be liquidated to settle as much debt as possible. Chapter 7 will stay on a person’s credit report for ten years.
Chapter 13 is a better option for people who have a regular income and lets a person keep most of their possessions. Essentially, a person can restructure their debt with the help of the courts and set up a 3 to 5-year payment plan. Chapter 13 does also does not affect a person’s credit in the same way as Chapter 7.
There were 15,743 bankruptcy filings in Arizona during 2018. Out of those, there were:
- 12,668 Chapter 7 filings
- 2,957 Chapter 13 filings
We bring you these numbers to point out that you are not alone when it comes to debt trouble. We want to stress the importance of not putting off filing for bankruptcy because you are afraid of what others may think or that “the situation might get better.” Once you reach a certain point, the debt will continue to snowball out of control, making unassisted recovery nearly impossible.
How We Can Help
Seeking the assistance of an Arizona bankruptcy attorney will go a long way towards getting you out of your debt trouble. The complexities of filing for bankruptcy, regardless of which route you choose, are beyond what most people want to handle on their own. Let a qualified attorney walk you through the process and handle the hard parts so you can focus on getting back on your feet.
Find out about 6 celebrities who filed bankruptcy.