5 Essential Details You Should Know About How Bankruptcy Works

The idea of filing for bankruptcy can be scary and confusing, especially if you do not know much about it. If you are considering filing for bankruptcy you should know about bankruptcy exemptions and bankruptcy laws in Arizona, and have questions like, “Can you file for bankruptcy twice?” answered by an experienced and knowledgeable professional.

1. What is the basic process of filing bankruptcy?

If you think you may qualify for filing bankruptcy, you will need to sort out your options. Using a means test will help determine which type of bankruptcy filing is best for you. You will also want to determine what bankruptcy exemptions apply to you.

You will need to collect a lot of paperwork, including proof of income sources, financial transactions, expenses, debts, and property, and fill out specific forms for filing.

Part of the bankruptcy process will involve credit counseling before you file, and a financial management course after you file.

2. Do you need an attorney for filing bankruptcy?

It is always a good idea to hire an attorney with knowledge of bankruptcy laws in Arizona. Filing bankruptcy is complex and involves a lot of paperwork and documentation. The court process can be long and involved, and having an experienced attorney to guide you through will give you the best results. Statistically, you are more likely to receive a discharge in a Chapter 7 bankruptcy with an attorney than without one.  In a Chapter 13, less than 1% of debtors filing on their own without an attorney will succeed (8 out of every 1,000 filers).

3. Can you file bankruptcy twice?

If you want to obtain a discharge then the following apply:

  • If you have filed for Chapter 7 bankruptcy, and are filing for the same type, you must wait eight years from your previous filing date.
  • If you previously filed for Chapter 7 bankruptcy and are now filing for Chapter 13 bankruptcy, you must wait four years from the previous filing date.
  • If you are filing for Chapter 13 bankruptcy and previously filed for Chapter 7 bankruptcy, you must wait six years after the previous filing date.
  • If you previously filed for Chapter 13 bankruptcy and are now filing for the same type, you must wait two years.

You can also file successive bankruptcies, either a Chapter 7 then a Chapter 13, or a Chapter 13 followed by another  Chapter 13 in certain situations where you are trying to save an asset or eliminate a lien.

4. What are some common bankruptcy exemptions?

There are some types of property you can keep no matter what – that includes some bank deposits, personal property, and benefits. You should ask your lawyer about bankruptcy exemptions that may apply to you.

5. How are bankruptcy laws in Arizona unique?
Bankruptcy laws in Arizona dictate that you must follow state law for bankruptcy exemptions instead of federal law exemptions with only a few exceptions. Whether you can use Aizona exemptions depends on how long you have lived in Aizona.


This blog is intended as a general discussion of legal issues and not as a statement of fact, legal advice or a legal opinion. No attorney-client relationship is created by this blog. Do not act or rely upon law-related information in this communication without seeking the advice of an attorney licensed to practice in the relevant area.

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