we focus 100% on debt matters

There are many options available and we know how to
determine the best one for the client.
request a free consultation

Little Rock Chapter 7 Bankruptcy Attorneys

Chapter 7 Bankruptcy in Arkansas

If you’ve reached the point where your debt is out of control and creditors are harassing you without mercy, you will be doing yourself a favor by consulting a Little Rock, AR chapter 7 bankruptcy attorney to find out if you qualify for a Chapter 7 bankruptcy.

In Arkansas, a Chapter 7 bankruptcy is the easiest and quickest way to legally wipe out your debt. This is the “traditional” bankruptcy where, with a few exceptions—taxes, student loans, and domestic support obligations (alimony and child support) — all of your debt disappears and you can start over with a clean slate.

What Debts Can You Wipe Out With a Chapter 7 Bankruptcy?

Chapter 7 will eliminate these types of debt:

  • Credit card debts
  • Unsecured loans
  • Medical bills
  • Judgments/Law Suits

Is Chapter 7 Right for You?

Many people never consider Chapter 7 because they’ve heard 2 myths (1) that it forces you to sell off all of your assets to pay your creditors, and (2) that they make too much money to qualify. DON’T BE FOOLED! In actuality, the laws protect your assets, up to a certain amount. Many people who receive the relief found in filing Chapter 7 bankruptcy will find that all of their assets are protected in full. People filing Chapter 7 end up keeping everything they own. This is something you need to discuss with an experienced Little Rock, AR bankruptcy attorney. You may be pleasantly surprised to learn that it is usually possible to eliminate all of your unsecured debt while keeping your property. And, so long as you are current on your mortgage and car loans, you can keep and continue to pay for those assets. Of course every situation is different, so you should speak with an experienced chapter 7 bankruptcy attorney in Little Rock who can help you determine how the law will work to protect you, your family and your property.

With regard to the other myth, you “make too much money to qualify” for Chapter 7, well, it’s your lucky day! You have found the attorney who knows exactly how the bankruptcy laws work with regard to the income requirements and how to make those laws work in your favor. Many individuals who felt like they did not qualify for Chapter 7 have been pleasantly surprised to learn that the do qualify and the debt stress they’ve been experiencing quickly disappears. It is all about finding an experienced and knowledgeable attorney who will work directly with you to make this determination.

What You Can Keep in a Chapter 7

Everyone who files a bankruptcy case, whether it is a Chapter 7 or chapter 13 bankruptcy, is required to list all of their assets, which is any interest they have in real and personal property. But do not fear! The bankruptcy laws protect your assets from creditors. There is a limit on the amount protected, but most folks fall well below that limit. This means that the individual can wipe away debt, which in bankruptcy is called discharging debt, and keep their property. You might have property that is collateral for a loan, like a mortgage on your house or a car loan. Again, no worries! In most cases you can keep and continue to pay for those items.

It is also important to know that in many cases your retirement accounts are protected in full. So do not use your retirement to pay off debt that you might be able to discharge before talking to someone who can tell you how the laws protect you.

This is just a sample list of some of the property that is protected and that you keep if you file a Chapter 7 bankruptcy case:

  • Equity in your home
  • Equity in a vehicle
  • A burial plot
  • Personal property like clothing and jewelry, books, musical instruments, and pets
  • Health aids
  • Crops and animals
  • Household items including appliances, furniture, etc
  • Tools, books, and implements required for your employment , referred to as “tools of the trade”
  • Child support payments
  • Most life insurance policies
  • Retirement accounts
  • Wrongful death awards and personal injury awards
  • Public assistance, Social Security, disability benefits , veterans’ benefits, and unemployment compensation benefits

Regardless of what you may have heard, Chapter 7 Bankruptcy laws clearly do not require you to surrender all your property, leaving you destitute. You are usually able to keep everything you need to continue on with your normal lifestyle—just without the debt.

How Chapter 7 Bankruptcy works

This is typically how a Chapter 7 Bankruptcy works:

Meet with your Little Rock chapter 7 bankruptcy attorney and complete the paperwork needed of filing your case. You will list all your assets, all your debts, your current income and various other bits of information necessary to complete the paperwork. You will also determine and indicate in your paperwork whether there are any debts that you wish to reaffirm. Reaffirming a debt means that you wish to continue to pay that debt rather than having it wiped away. The debts most commonly reaffirmed are home mortgages and car loans. Obviously, if you want to keep your house and keep your car then you will want to reaffirm the debt and keep making payments on those items.

Before the case can be filed you must complete an instructional class referred to as Credit Counseling. Don’t worry, you do not have to sit in a classroom. You can take the class online or on the telephone. It only takes a few moments to complete the class. Your attorney will generally have a provider that they prefer you to use to take the class.

Once everything is signed and you have completed your Credit Counseling class, your attorney will file your case. Everything is electronically filed in bankruptcy cases. The computer will automatically assign a trustee and a bankruptcy judge to your case after it is filed. Everyone who files bankruptcy has to attend one meeting with their trustee. That meeting is called the “Meeting of Creditors” because it is not only an opportunity for your trustee to ask you questions about your bankruptcy case but also an opportunity for creditors to question you. Don’t worry! It is actually pretty rare for a creditor to attend the meeting and ask questions. That normally only happens when there is some kind of complicated debt or issue pending in the case. The average bankruptcy filer who has regular debt like medical bills and credit cards, will simply attend the meeting and answer the few simple questions posed by the trustee.

Some point after your case is filed you will need to enter into any reaffirmation agreements.

After you have attended the Meeting of Creditors you are done. Creditors and the trustee have a time period during which they can file objections to your discharge, but once that time period passes the judge will enter your discharge order. The discharge order means your debts are wiped away and you are officially worry free!

There are of course other requirements associated with filing bankruptcy. This is merely a simplified discussion of how a Chapter 7 bankruptcy case proceeds.

Alternatives that Might Also Work Well for You

Chapter 7 may be the simplest way to obtain relief from your debt, but it is not for everyone. For some individuals and families find that a Chapter 13 bankruptcy is a better choice. One situation where you might prefer Chapter 13 is if you’ve fallen behind on your home mortgage payments or car note. Chapter 13 will immediately stop threatened foreclosure and repossession and will give you time to catch up on payments. Your Arkansas bankruptcy attorney will discuss the pros and cons and the qualification requirements for each.

How to Get the Help You Need to Make the Best Decision about Personal Bankruptcy

When you’ve been struggling with debt for so long that you’ve begun to feel hopeless, you need to know that help is available. You don’t have to live with creditors harassing you for money you don’t have and payments you can’t make.

Contact Dilks Law Firm today. Lyndsey Dilks understands the stress that comes with being overwhelmed with debt, and she knows how to make the Arkansas bankruptcy laws work for you. Don’t allow debt to ruin your life. Lyndsey will review your situation and show you how to free yourself from the cloud of debt that’s been hanging over you and your family. Don’t suffer another day. Call now.