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Arkansas Bankruptcy Information- How To File A Case

Arkansas Bankruptcy Information- How to File a Case

In most ways, filing for bankruptcy in Arkansas is the same as filing in another state. Arkansas bankruptcy is governed by federal law.

Financial difficulties are an inevitable aspect of life. However, if you are one of the millions of people in Arkansas who are struggling financially due to a job loss, sickness, or other calamity, bankruptcy can help. You'll find an overview of Chapters 7 and 13, and information about Arkansas's property exemption laws and filing requirements.

Arkansas Bankruptcy Procedures

The bankruptcy process is governed by federal law rather than Arkansas state law, and it works by dissolving contracts between you and your creditors—this is what provides you a fresh start.

However, Arkansas' laws play a big role. They decide which assets you can keep in your bankruptcy case. You'll also need to know some other filing information, which we'll go over once we go over the fundamentals.

People with greater assets, on the other hand, may lose them, especially if they buy superfluous luxury products. For example, if you have too much equity or are behind on payments, you may have to give up your RV, baseball card collection, or timeshare in the Bahamas, or even your house or automobile. Unlike Chapter 13, Chapter 7 does not offer a payment plan to catch up on late mortgage or car payments. If you are late in filing, you may lose your home or car.

Arkansas Chapter 13 Bankruptcy Filing

Chapter 13 filers must repay creditors in full or in part over a three to five-year period. The payment plan, on the other hand, allows Chapter 13 to give benefits not available in Chapter 7. Not only do you preserve all of your belongings, but you can also avoid foreclosure or repossession of your home or automobile. You can use this chapter to persuade a creditor to agree to a payment plan if you need additional time to settle a debt that you cannot discharge in bankruptcy.

The most significant disadvantage of this chapter? It can be costly, and many people are unable to make the monthly payment. Find out when filing for Chapter 13 is preferable to file for Chapter 7. Furthermore, businesses are not permitted to file a Chapter 13 case. If you own a business, you should understand the ins and outs of small business bankruptcy.

Will Bankruptcy In Arkansas Discharge My Debts?

Many bills are discharged in bankruptcy, including credit card balances, past-due utility payments, medical bills, personal loans, and others. If you're ready to give up the house or car that secures the loan, you can even get rid of a mortgage or car payment.

 (Using property as collateral produces a "secured debt"—if you don't pay what you owe, the lender has the right to repossess the property.)

However, you cannot discharge all debts. No dischargeable debts, such as domestic support arrearages and current tax arrears, will not be discharged in bankruptcy, and school loans are difficult to discharge (you'd have to win a separate lawsuit). You'll want to make sure that filing for bankruptcy will discharge (remove) enough bills to make it profitable.

Need More Bankruptcy Assistance?

Did you know that Flynn Law Firm has been simplifying the law for decades of years? It's true, and we want to make sure you find what you're looking for. You can consult with one of our top rated Bankruptcy Lawyer in Arkansas to peruse your case smoothly.