There are several situations that may arise when a Chapter 13 Bankruptcy is preferable to a Chapter 7 Bankruptcy. If you are living in Phoenix or Maricopa County and want to know which Chapter of Bankruptcy is best for your situation, take a read of this article. Alternatively, you can call our Phoenix Bankruptcy Office at (602) 609-7000.
Whereas, a Chapter 13 bankruptcy is the only choice if you are behind on your mortgage or business payments and you want to keep your property. You may also be able to strip a 2nd mortgage in a Chapter 13. Additionally, a chapter 13 bankruptcy, (through the Ch 13 repayment plan,) allows you to make up their overdue payments over time. Consistent payments in your repayment plan will allow you to reinstate the original mortgage agreement. In general, if you have valuable property that is not covered by the Arizona bankruptcy exemptions that you want to keep, Chapter 13 bankruptcy may be the better option than a Chapter 7. Another reason people file Chapter 13 bankruptcy is they make too much income to file a Ch. 7. Also, debt that is not dischargeable in a Chapter 7 (e.g. certain taxes) makes a Chapter 13 a viable Phoenix debt relief option.
However, far and away, more people in Phoenix, Maricopa County, Arizona simply want to get rid of their debt and seek a “Fresh Start“. Chapter 7 Bankruptcy provides an attractive choice for Phoenix residents as they simply eliminate their heavy debt burden without paying any of it back.
How much does it cost to file a Chapter 7 Bankruptcy?
The mandatory fee you will pay to the court for a Chapter 7 bankruptcy is $335. However, if you can’t afford the filing fee, you may be able to have it waived or pay in installments. Plus, the bankruptcy court is likely to deny these requests if you are represented by an attorney unless they are working pro bono (for free).
Attorney fees in a chapter 7 bankruptcy vary a lot. Plus, your attorney’s fees will likely be substantially higher than the court filing fee. Phoenix bankruptcy lawyer cost vary. Likely, debt relief lawyer fees are based on a few other factors. For instance, if your case is highly complex, your Phoenix BK Attorney may need to charge a bit extra. Also, attending additional hearings such as a reaffirmation hearings may come with an added fee.
Keep in mind, an experienced attorney with a good reputation usually charges a greater fee than a newer attorney. Experience matters! Lastly, some attorneys offer special services like $0 down payment plans. Attorneys often must charge a premium to be able to offer such programs. You will also need to pay for your credit counseling courses, but these fees are negligible compared to the filing fee and attorney’s fees.
How much does it cost to file a Chapter 13 Bankruptcy?
The attorney’s fees for a Chapter 13 are typically much higher than for a Chapter 7. However, you may be able to reach an agreement with your attorney for a small amount down, and work the rest of your attorney’s fees into your payment plan. The court filing fee for a Chapter 13 bankruptcy is $310.
How long does a Chapter 7 Bankruptcy stay on a person’s credit?
Chapter 7 Bankruptcy in Phoenix remains on your credit for 10 years from the date your case is filed. Consult our Phoenix Zero Down bankruptcy team for details.
How long does a Chapter 13 Bankruptcy stay on a person’s credit?
Chapter 13 Bankruptcy remains on your credit for 7 years from the date your case is filed. This is a shorter period of time than a Chapter 7. Contact our Phoenix Bankruptcy team for details.
Filing Bankruptcy in Phoenix, Explained
Bankruptcy is a legal mechanism that exists to provide a means for those struggling with debt to either liquidate it through a chapter 7 bankruptcy filing or reorganize it in a chapter 13 bankruptcy. Chapter 7 bankruptcy is the most common form of consumer bankruptcy in Phoenix, Maricopa County, Arizona. However, many people in Phoenix are disqualified from filing Chapter 7 as they do not meet the chapter 7 qualifications. Another possibility of filing bankruptcy when you do not qualify for a chapter 7 is filing chapter 13 bankruptcy.
A Chapter 13 bankruptcy filing in Phoenix organizes debts into a payment plan that lasts 3-5 years. To qualify for either chapter of bankruptcy, you must meet Arizona’s 180-day residency requirement. Thus, our Zero Down Phoenix bankruptcy lawyers can evaluate your financial situation and advise you on the best chapter of bankruptcy. Also, our attorneys will do a free debt evaluation with you to make sure you meet all the applicable eligibility requirements. Get debt free, Phoenix!