Chapter 7 bankruptcy is a form of bankruptcy that involves liquidating the debtor’s personal assets. It is a measure that may be seen as extreme, and it is often a last resort. If you have considered alternative options with a trustworthy counselor and believe Chapter 7 is the right way to reduce your debt, call Bowman, Smith & Kallen to get started moving forward.
Don’t declare bankruptcy without consulting us first. Contact the Yuma bankruptcy attorneys at Bowman, Smith & Kallen for a free consultation. Dial (928) 433-2355 or contact us online.
What Happens in Chapter 7 Bankruptcy?
Though a partnership or corporation may file for Chapter 7 bankruptcy, it’s possible that other forms of bankruptcy may provide you more options to keep your business as an asset. Individuals (and couples) may also file under Chapter 7.
Once you file, the court will ascertain whether you meet certain eligibility requirements for Chapter 7 bankruptcy. You will need to submit supporting documents and schedules to show that selling off your property is a better solution than a repayment plan, plus you will need to submit a list of all your property, debts, and creditors. Once the petition is accepted, an impartial case trustee will be appointed to sell your property and pay off your debts.
In Arizona, property exemptions to Chapter 7 bankruptcy are governed by state regulations. In order to claim property as exempt, you must complete a “Schedule C – Property Claimed as Exempt” form.
Many types of property may be claimed as exempt:
- The homestead—house and land in which you live
- Personal property such as household furnishings, appliances, and electronic devices
- Other smaller items—clothes, wedding rings, pets, musical instruments, and others up to a certain designated value
- Equity in one vehicle, up to $6,000
- Up to $20,000 of life insurance proceeds if payable to a spouse or child
- Certain other monetary benefits or assets, such as a pension
Note that you must have lived in Arizona for two years before filing for bankruptcy to claim the property exemptions allowed under our state law. To make sure you have grounds for exemption, it’s a good idea to consult with an attorney.
The Importance of Legal Counsel
Before such a major step, it’s important to consider all your options from a legal angle. A Yuma bankruptcy attorney can help you make sure Chapter 7 is right for you. They can also assist with filing the proper forms and advise you on the documentation needed throughout the process.
Call (928) 433-2355 to reach Bowman, Smith & Kallen and consult with us about your Chapter 7 bankruptcy petition.
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