When it rains, it pours- and if you have both a bankruptcy and a family law matter on the horizon, you know this to be true. Because of how these two legal matters interact, you need to take special care in each filing’s timing. More often than you might think, bankruptcy becomes a necessity in an Arizona Family Law case. It is important to understand how Arizona Bankruptcy and Family Law often intersect.
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One of the biggest benefits of filing bankruptcy is the Automatic Stay, a legal mechanism that protects you from garnishments, repossessions, etc., by your creditors while your bankruptcy is active. Stopping a wage garnishment for months or even years will help you get back on your feet, and the garnishment will be halted permanently if the associated debt is discharged in your bankruptcy. However, there are some exceptions to the Automatic Stay, including that many garnishments that stem from domestic obligations that are exempt from its protections.
If your wages are garnished to pay your child support or spousal maintenance, these will continue in both a Chapter 7 and Chapter 13 bankruptcy. If you are being garnished for support arrearages, these will continue in a Chapter 7. Garnishments for unpaid support will stop in a Chapter 13 if your plan provides for your entire unpaid balance to be resolved. Contact an experienced Arizona Bankruptcy and Family Law attorney for assistance.
We accept bankruptcy clients throughout Arizona. No office visit necessary. We provide experienced bankruptcy services with personal and professional attention throughout the legal process.
Consult with the expert bankruptcy legal team if you are faced with:
Harassing phone calls from creditors
Loss of a job or wages
Making monthly bill payments
Crushing credit card debt
A wage garnishment
Clients who call upon our services have overwhelming debt caused by life circumstances. We understand that Arizona residents are faced with difficult financial situations that result in debt. We are here to help you get out of debt, and our team will be with you throughout the bankruptcy process.
When a Bankruptcy Filing in Arizona will Stop a Family Law Case
The Automatic Stay protects you during bankruptcy by freezing your assets, but this can complicate things in a divorce. One of the vital components of a divorce that must be completed before the divorce can be finalized is property division. Both assets and debts acquired by the spouses will be split during property division. A bankruptcy will interrupt your divorce unless there are no assets and debts to divide between the spouses, which is a rare occurrence.
If you and your spouse intend to divorce but can agree upon property division, an Arizona bankruptcy filing won’t interrupt other divorce issues like child support and custody. If you are in an active bankruptcy, this won’t prevent you from addressing family law issues like domestic violence, establishing paternity, or parenting time modifications.
Family Court Proceedings and Debts in Bankruptcy
Deciding how debts should be divided between spouses can be one of the most contemptuous issues in a divorce. Depending on the structure of your debts, it may be advantageous to file bankruptcy first. You may even have an easier time qualifying for Chapter 7 after your divorce, or your Chapter 13 plan payments may be lower. A Chapter 7 bankruptcy will halt your divorce proceedings for the length of your bankruptcy case, typically 4-6 months. Divorcing during a Chapter 13 is impractical as the bankruptcy will last 3-5 years, and your payment plan will be formulated based on your status as a married couple.
You should consult with a bankruptcy attorney to determine if your bankruptcy should be filed before or after your divorce. It is important to understand that bankruptcy and family law, though 2 separate types of law, often cross paths. Contact our Arizona Bankruptcy and Family Law attorneys for a free consultation.
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When you consult with Arizona Zero Down Bankruptcy Law Firm, your case becomes a priority. An attorney will explore all legal options available for you to eliminate debt. Our legal team will help you to understand the bankruptcy process, and explain your rights as a debtor. Through effective communication and dedication to clients, Arizona Zero Down Bankruptcy provides clients with expert legal representation. We listen to your concerns about your debt, and offer legal services that will produce the best possible outcome for your financial needs.
Does the Automatic Stay stop the collection of ongoing Child or Spousal Support?
Filing bankruptcy doesn’t excuse you from your familial obligations. Your child and spousal support payments will continue as usual during your bankruptcy, despite the Automatic Stay being in place.
How Does Bankruptcy Impact Child Support Payments in Arizona?
Child support can be garnished at far higher rates than other debts in Arizona, and your garnishment may not be stopped by the Automatic Stay when you file bankruptcy. Most debts that are discharged in bankruptcy can garnish your wages at a rate between 15 and 25 percent. Your wages can be garnished for child support by up to 50% if you have no other dependents, and 60% if you do. An additional 5% is garnished if the obligor is behind on payments by 12 weeks or more.
If you are being garnished at the state maximum levels for child support, filing Chapter 7 will only help you by discharging your other unsecured debts. Your garnishment will not pause during your bankruptcy, and the child support debt will remain after your other debts have been discharged. It may be preferable to file Chapter 13 in this situation. Your ongoing support payments will continue as usual, but your garnishment will stop if your plan arranges for payment of all of your arrearages.
ARIZONA ZERO DOWN BANKRUPTCY AND FAMILY LAW
When to lift the stay in Family Law and Divorce cases in Arizona
If you are involved in a divorce and bankruptcy concurrently, you may want to consider lifting the Automatic Stay after your bankruptcy petition is filed. A spouse who is also a creditor to an individual who has filed bankruptcy may file a request with the court to lift the Automatic Stay. This will allow that individual to proceed with financial aspects of a family law case, like property division.
How can an Arizona Bankruptcy Attorney assist me with family law issues that occur during a bankruptcy?
Your Arizona bankruptcy attorney won’t be able to draft or file motions for your family law case, but can definitely assist you in deciding which chapter of bankruptcy to file, and when. Arizona is a community property state, so you may not realize how much of your property your spouse is entitled to in a divorce, or how much debt your spouse incurred during the marriage for which you can be held responsible. You can also be pursued by creditors for debts that your spouse was ordered to pay in your divorce, and later discharged in bankruptcy.
Filing bankruptcy jointly before a divorce may clear both spouses’ debts and allow them to focus on assets instead of debts during property division. However, especially when both spouses work, it may be easier to qualify for a Chapter 7 bankruptcy after divorce. There are strict income limits for Chapter 7, and the spouses’ income will be combined for bankruptcy purposes. In Arizona, a single filer may make up to $52,319, but a married couple can only make $65,713 combined to qualify for Chapter 7.
Deciding When to File Bankruptcy when in a Family Law Issue
Making the decision about which chapter to file and when may not be a clear-cut decision, and there are countless potential moving factors when you’re involved in both family law and bankruptcy cases. To gain clarity about your upcoming legal battles, call today to schedule your free consultation with one of our expert Arizona bankruptcy lawyers.
Our staff and Arizona Zero Down Bankruptcy Attorneys have years of experience representing bankruptcy clients in conjunction with family law cases. Get your questions answered free of charge, and receive a reasonable quote for representation, as well as post-filing payment plans starting as low as $0 down!
CONTACT ARIZONA ZERO DOWN BANKRUPTCY AND GET DEBT FREE TODAY
If you are facing an auto repossession, contact our Arizona Zero Down Bankruptcy attorney. Our attorneys help clients understand the bankruptcy process as a solution to debt relief needs. The legal staff at our law firm will ensure that your rights as a debtor are protected, and that you understand the debt relief process as it pertains to your specific financial debt situation.
SAVE YOUR HOME
Arizona Zero Down Bankruptcy attorneys can help you keep what is important to you and your family. If you are facing a foreclosure, contact our firm for assistance. Our lawyers give professional advice whether or not bankruptcy is the best option for your debt relief needs.
STOP A WAGE GARNISHMENT
A wage garnishment threatens your income, and affects your professional career. Arizona Zero Down Bankruptcy Attorneys will review your financial situation, then help you to understand the impact of a wage garnishment. We will review the benefits filing bankruptcy protection can provide, including stopping a wage garnishment.
ELIMINATE CREDIT CARD DEBT
Arizona Zero Down Bankruptcy represents clients across Arizona wipe out overwhelming unsecured debt such as credit card debt. If you are unable to pay more than the minimum payment on your credit card statement, or if you have debt that prevents you from making minimum monthly payments, our experienced debt relief legal team can help.
DEBT RELIEF AND YOUR PROPERTY
Stripping a lean in a Chapter 13 bankruptcy is complicated, depending on the asset and value, and needs the attention and representation of an experienced attorney. Chapter 13 bankruptcy protection provides a means to eliminate mortgage liens on real estate property. Consult with Arizona Zero Down attorneys to better understand how to remove a lien from your home.
DEBT RELIEF FROM MEDICAL DEBT
Clients who experience medical emergencies resulting in crushing medical debt get debt relief help from Arizona Zero Down Bankruptcy lawyers. Medical bills from illness, surgery, doctor visits, prescriptions, and other health crisis can become staggering. Arizona Zero Down Bankruptcy law firm can help you get control over this type of debt.
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I didn’t know how I was going to afford an attorney to file my bankruptcy. Because Arizona Zero Down Bankruptcy offers no money down, I called, set up an appointment, met my attorney, and my bankruptcy was filed — and it didn’t cost me a penny upfront.
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