Bankruptcy In Arizona

Find Out What All of Your Options Are And All About Bankruptcy In Arizona

Requirements prior to filing bankruptcy

Filing for bankruptcy in Arizona requires good preparation. Realize that you will be required to participate in credit counseling within six months prior to filing. Start to gather your financial paperwork before filing, because you will need to itemize your income and expenses and obtain copies of your tax returns for the previous two years. You should also gather together any titles or loan documents. And the requirements won't end with the court's decision; plan to complete a financial management course after you've declared bankruptcy.

Determining what chapter of bankruptcy to file

Bankruptcy in Arizona provides two options for filing. You may file a Chapter 7 bankruptcy or a Chapter 13 bankruptcy depending upon your financial resources. A Chapter 7 bankruptcy in Arizona provides for the liquidation of your non-exempt assets and payment of your credits for the proceeds of the sale of those assets. A Chapter 13 bankruptcy in Arizona provides for a reorganization of your debt. You will make payment arrangements with all creditors to pay the debts due. Upon filing your bankruptcy in Arizona, the court will analyze your income and expenses averaged over the six months prior to filing. This will be compared to the median income in Arizona. If your income is below Arizona's median income, you will be allowed to file Chapter 7 bankruptcy. If your income exceeds the median income for Arizona, your finances will be further analyzed through mathematical formulas to determine whether you can file a Chapter 7 bankruptcy. Even if you are allowed to file a Chapter 7 bankruptcy, you can still choose to file a Chapter 13 bankruptcy.

Filing bankruptcy in Arizona

In order to actually file bankruptcy in Arizona, you will need to complete the petition for bankruptcy and its accompanying forms. These are called 'schedules.' There will be a small fee for filing the forms with the bankruptcy court in Arizona. Upon filing for bankruptcy in Arizona, an automatic stay will immediately go into effect. This will prevent creditors from engaging in any direct collection activity against you or your assets.