What legal rights do my creditors have at their disposal?
They have the legal right to call you and to send you notices in the mail. They can repossess your car, furniture and appliances. They can pull you in for a debtor’s exam. They have the right to serve you with legal documents, to litigate your case in court and to gain a judgment against you. Afterwards, they can contact your place of employment to garnish your wages; they can put a hold on your bank account and they can place a lien on your home. They also have the right to bill you for legal fees and to apply high interest rates on your debt.Â
Can I get my creditors to negotiate lower interest rates and payments on my own?
Yes, but it can be risky. Some of your debts may have been purchased by third parties or may be with law firms, and their only concern is to force you to pay as much as possible on your debt as quickly as possible. Even right during negotiations, a lawsuit could show up on your doorstep.
Am I being irresponsible by filing bankruptcy?
Not if you’ve already done what you can to avoid bankruptcy, like most of our clients have. You likely had a reduction in income, a divorce, or an illness that has caused you financial hardship. Remember, the federal government has made it lawful for anyone to declare bankruptcy because it knows that, for the most part, those who do file are responsible people who just ran into unexpected difficulties.
Will bankruptcy permanently ruin my credit?
No. People who file bankruptcy are often surprised by how quickly they’ll start getting credit card offers in the mail again. Offers for secured credit cards (which require a deposit to the bank) with a low limit can arrive within a month of the debt discharge. And many car dealerships and furniture stores are happy to work with those who have declared bankruptcy, and your on-time payments will be reported to the credit agencies’ reports that will serve to improve your credit score! We also offer an exclusive program called 7 Steps to 720 that can help you quickly and easily rebuild your credit score.
Can my medical or credit card bills be discharged in bankruptcy?
Yes! Almost all unsecured contract debt, like credit cards, personal loans, and medical bills, remain dischargeable in bankruptcy.
Can I get rid of back taxes in bankruptcy?
Sometimes. Some federal, state and local taxes, inheritance taxes, and personal property taxes (including interest and penalties) can be discharged in bankruptcy. There are several qualifications that have to be met to do so, but often tax debt can be reduced or eliminated in bankruptcy.
Is it really hard to file for bankruptcy?
No, not really. In the beginning certain documents must organized and provided, and a financial questionnaire needs to be filled out. But afterwards, in the hands of an experienced Phoenix bankruptcy attorney, a bankruptcy case generally goes very smoothly. We handle all the technical details, leaving you free to concentrate on your family and loved ones, and to rebuild your financial future.
Will I lose everything if I file for bankruptcy?
No. In most bankruptcy cases filed by individuals, the debtor is able to keep everything they own. That’s because exemptions provide for assets that the debtor can keep and some assets, like retirement accounts, are beyond the reach of bankruptcy trustees and creditors. Furthermore, Chapter 13 reorganization is specifically designed to enable you to keep your assets while paying only the amount of debt that you can reasonably afford.
Why shouldn't I use a law firm that will charge me a lesser fee?
In this instance, the old adage is true: “You get what you pay for.” Please understand, to stay afloat these bargain firms must entice a large number of clients each month and place their caseloads into a one-size-fits-all, cookie cutter template. Also, they often require their clients to perform casework that should be in the hands of a skilled paralegal or attorney. And court fees are rarely included in their advertised price. Even more, one of the most prominent “discount” bankruptcy firms in Arizona has recently declared its own bankruptcy, leaving thousands of people without an attorney, even though they had already paid some or all of their fees. So, be very cautious of those types of firms.