What Is Bankruptcy & How Does It Work?
How does bankruptcy work?
Bankruptcy is a legal process designed to help individuals and businesses which cannot meet their financial obligations, as well as protecting creditors.
The process is sometimes very complex, and there are many potential traps. That’s why it’s critically important to work with highly experienced bankruptcy attorneys who specialize in this process.
How much does bankruptcy filing cost?
Just as with any legal matter, in a bankruptcy filing the attorney fees depend on the circumstances of the case. For a Chapter 7 filing the attorney fees begin at $1275 for a person who has consumer debts, but has no contested issues, no past-due alimony or child support, no business problems and no delinquent taxes.
For a Chapter 7 filing which includes one or more of the complexities mentioned above, the attorney fees start at $1750.
Chapter 7 filing for a small business starts at $2000. And, the attorney fees for Chapter 13 bankruptcy are about $4500 for a businessperson with no special issues to be resolved.
You are required to disclose all your assets and liabilities. The U.S. Bankruptcy Trustee is quite aggressive in discovering bankruptcy fraud.
Who may file a bankruptcy?
Anyone who lives in Arizona, or does business here, or owns property here can file bankruptcy. There is no debt threshold requirement to file. In order to file here in Arizona, you must have been living here for the majority of the past 6 months, or a minimum 91 days.
Can a husband and wife file a joint bankruptcy together?
Yes. Under bankruptcy law, spouses may jointly file a bankruptcy petition using the same documents. A joint petition requires only a single filing fee, so it costs the same as a single person.
Can I still file a bankruptcy even if my debts are being handled by a financial counselor?
Yes. Financial counselors are helpful at times, but they have no legal status and they can’t stop you from filing your bankruptcy.
Can filing bankruptcy help if lawsuits are already filed against me?
Filing a bankruptcy petition will automatically halt most lawsuits. Within a few days after filing, the bankruptcy court will mail notices to all your creditors, ordering them to stop their actions against you.
Wage garnishments – Best of all, a bankruptcy filing will stop creditors who are trying to garnish your wages, except for garnishments for alimony or child support.
How about alimony-maintenance, child support and legal settlements?
U.S. Bankruptcy Code 11 U.S.C. § 523(a)(5) specifies that someone filing bankruptcy usually can’t discharge financial obligations to pay support for a child, or to a spouse or former spouse.
Ready for debt relief, and a fresh start? Copperstone P.C. can help!