Arkansas Bankruptcy Law Firm

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Little Rock Bankruptcy Testimonials

five star review

I was at the point of having a breakdown because my car had been repossessed. Googled bankruptcy lawyers and Brandon Haubert showed and stated it was open 24/7, so I called and Brandon was very helpful and got me in the next day. They were friendly and willing to work with me. I highly would recommend them to anyone.

-  Nikki Brown via Google

five star review

They are the best!!! Got me in right away and got my car back within 1 day of my first meeting. Jessica is the best and so is Brandon I would recommend them to anyone who’s thinking about going bankrupt.

- Jasmine Danielle via Google

five star review

Brandon and Jessica helped so much. They filed an emergency bankruptcy with $0 down and stopped my creditors fast. Stopping the stress was so worth it.

- Drey McNash via Google

five star review

Wh Law is a great bankruptcy law firm ...they have great lawyers here that are really helpful...Jessica is the best...

- David Colvin via Google

Tackling Bankruptcy in Arkansas

Declaring bankruptcy sounds like a scary concept, but it’s an excellent solution if you’re suffering from severe debt.

Filing for bankruptcy often happens after a person suffers serious debt from life events such as illness, divorce, foreclosure, job loss, repossession, garnishment, or a lawsuit.

The issue is that debt can pile on quickly, and unfortunately, it’s often quicker than people can afford to pay in times of crisis. This leaves people in a vulnerable position where they fear making monthly payments and wonder how they’ll ever be financially secure again. Severe cases of debt can result in repossession and foreclosure.

In a situation like this, a person might start considering solutions to get out of debt, like bankruptcy. It’s often the most viable option, and we want to eliminate any negative perceptions you may have with this valuable debt management tool.

What Is Bankruptcy?

Bankruptcy is when you owe more than you can pay. It’s important to note that not everybody who is in debt is bankrupt: there has to be a significant difference in what you’re paying and what you owe.

The concept of bankruptcy is not as awful as it may sound. Although it’s not something to be taken lightly, it is a solution that allows people to get out of debt while also treating creditors fairly. It can help solve many problems if you are suffering from immense amounts of debt.

Should I File For Bankruptcy?

Living in debt is something most people experience, but there’s a line between making monthly payments and drowning from those payments. If you’re fearful of how much debt you owe and are considering filing voluntarily, start by asking these questions:

  • Do you only make minimum payments? 
  • Are bill collectors frequently calling you?
  • Do you use credit cards to pay for necessities? 
  • Have you lost track of how much you owe? 

If you answered “yes” to these questions, then it’s time to reevaluate your financial situation. It might also be time to consult with a lawyer who can help you navigate through declaring bankruptcy.

Bankruptcy can be filed in one of two ways: you can voluntarily file, or creditors will ask the court to order you as bankrupt. It’s always best to come forward and acknowledge the situation you’re in, and to do so you need to understand the four types of bankruptcy. 

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Chapter 7 Bankruptcy

Chapter 7 bankruptcy, also known as liquidation or straight bankruptcy, is one of the most common forms because it offers a fresh start.

Liquidation bankruptcy is a popular option for personal debt because it helps wipe out debts like credit cards, medical bills, and personal loans, but without a repayment plan. Typically, this method lasts from four to six months. 

This is how it works: in exchange for wiping out your existing debt, you must agree that a trustee — such as your lawyer — can take and sell some of your assets to help pay back the debt. It is essentially a form of collateral so you can prove to creditors that you’re working on paying them back as much as possible. 

The good news is that you can keep necessary assets so you can continue working and maintain your home, such as household furniture, clothing, and your vehicle. Of course, the specifics vary from case to case, but this is what you can typically expect. 

However, liquidation bankruptcy won’t discharge debt like child or spousal support, income taxes, injury or wrongful death lawsuits, or student loan debt.

A chapter 7 bankruptcy case does not involve having to repay all of your debts. Instead, the bankruptcy trustee gathers and sells your nonexempt assets and uses the money from those assets to pay people you owe money to. In addition, the Bankruptcy Code and Arkansas Law will allow you to keep certain “exempt” property. However, the trustee will liquidate any nonexempt property you have.

Who is eligible for Chapter 7 Bankruptcy in Arkansas? The answer is simple: Regardless of if you live in North Little Rock, Conway, Cabot, Bryant, or even Fayetteville, you are not subject to the means test (and can file for Chapter 7 Bankruptcy) if you make less than the amounts below.

Free Chapter 7 Bankruptcy Petition and Schedules

(Arkansas Median Income for Family Size as of November 1, 2017)
  • 1 Person Family: $42,546
  • 2 Person Family: $52,621
  • 3 Person Family: $58,931
  • 4 Person Family: $66,712
  • 5 Person Family: $75,112
  • 6 Person Family: $83,512
  • 7 Person Family: $91,912
  • 8 Person Family: $100,312
  • 9 Person Family: $108,712
  • 10 Person Family: $117,112

If your household income is above the number above, you can still file Chapter 7 bankruptcy here in Arkansas, if you pass the means test.

An individual cannot file under chapter 7 or any other chapter, however, if during the preceding 180 days a prior bankruptcy petition was dismissed due to the debtor’s willful failure to appear before the court or comply with orders of the court, or if the debtor voluntarily dismissed the previous case after creditors sought relief from the bankruptcy court to recover property upon which they hold liens. 11 U.S.C. §§ 109(g), 362(d) and (e). In addition, no individual may  file for bankruptcy under chapter 7 or any chapter of the Bankruptcy Code unless he or she has, within 180 days before filing, received credit counseling from an approved credit counseling agency either in an individual or group briefing. 11 U.S.C. §§ 109, 111. There are exceptions in emergency situations or where the U.S. trustee (or bankruptcy administrator) has determined that there are insufficient approved agencies to provide the required counseling. If a debt management plan is developed during required credit counseling, it must be filed with the court.

One of the primary purposes of bankruptcy is to discharge certain debts to give an honest individual debtor a “fresh start.” The debtor has no liability for discharged debts. That simply means that once the bankruptcy court has granted a discharge of your debts, you are no longer responsible for paying them.  In a chapter 7 case, however, a discharge is only available to individual debtors, not to partnerships or corporations. 11 U.S.C. § 727(a)(1). Although an individual chapter 7 case usually results in a discharge of debts, the right to a discharge is not absolute, and some types of debts are not discharged. Moreover, a bankruptcy discharge does not extinguish a lien on property.

Chapter 13 Bankruptcy

Chapter 13 bankruptcy, also known as reorganization or wage-earner bankruptcy, is another common form that is ideal for those who have property they want to keep. This method helps reorganize debt for those earning an income. Most people use this method to catch up on past-due house and car payments to avoid repossession or foreclosure. 

Here’s how it works: when filing for Chapter 13 bankruptcy, you can keep all your property, but you must pay creditors the value of any nonexempt assets as part of a three- to five-year payment plan. To qualify, you must have a reliable source of income to repay some portion of the debt. 

Bottom line, Chapter 13 Bankruptcy helps people with regular income to create a plan to repay all or part of their debts. If you are reaffirming debt in a Chapter 7, then your payment in a Chapter 13 may not be more than a Chapter 7, in fact it may be less.

Free Chapter 13 Bankruptcy Petition and Schedules

What will my payment be under a Chapter 13 bankruptcy payment plan?

This depends on several issues:

  1. What secured property (property they can take away if you don’t pay for it – houses and cars) do you want to keep and pay for? In the case of secured property there are two major options:
    1. Surrender the property back to the creditor and not pay anything;
    2.  Keep and pay for the property, and if it was purchased recently you have to pay the balance due plus interest, but you can lower the interest rate, or if you purchased a while ago (910 days for cars and 1 year for household goods), you only have to pay what you owe or what it is worth, whichever is less.
    3. With a house payment, there are three options:
      1.  If the payments are current, continue to pay it yourself and don’t pay it through the Chapter 13 plan; or
      2. Make the regular monthly payment through the plan, and if you are behind on the payment, catch up the payments in the plan. This way when the bankruptcy is over, you will be current and pick up and pay the normal monthly payment; or
      3.  Pay the balance in full within the plan.
  2. What is your Plan Length? The length of your plan can be a minimum of 36 months (3 years) and a maximum of 60 months (5 years). If you do not pass the means test and you are not paying everyone back in full, then the plan has to be 5 years.
  3. The calculation of your disposable income. Under the bankruptcy code your disposable income (how much money is left after you pay all of your necessary monthly bills) will be calculated, and you will have to pay at least that amount towards bankruptcy most of the time. There are exceptions. Also, courts typically allow debtors to keep an amount of money every month for entertainment purposes. Filing Chapter 13 bankruptcy does not mean you have to live like a pauper for the next five years.
  4. What priority debts do you have? Priority debts are things such as taxes, wages owed to others, alimony, and child support. All priority debts, except child support, must be paid in full within the life of the plan. All priority debts will be paid through the plan except child support. You will continue to pay child support however you are directed to do so by the court.
  5. What non-dischargeable debt do you have to repay?  Non-dischargeable debt can include student loans, punitive damages, judgements based on fraud, etc. Student loans are the most common.
    1. Remember, any unpaid amount plus interest and any collection fees will be due after you get out of Bankruptcy.  You have two options:
      1.  Ignore the student loan and pay nothing through the plan; or
      2.   Pay your normal monthly payment and catch up what you are behind.
  6. What leased property do you want to keep and pay for? More often than not, lease-purchases are not financially wise transactions.  If you have leased property, you have three (3) options:
    1. Reject the lease and let the creditor have the property back and pay them nothing;
    2. Accept the lease contract as written, and continue to pay them directly, not through the plan, if your payments are current; and
    3. Accept the lease contract as written, and pay it through the plan, and if you are behind on payments, catch those payments up through the plan.
  7. What debts do you owe jointly with other people who are not filing bankruptcy? You have two options:
    1.  Pay nothing towards the obligation and let the responsibility fall on the co-debtor or person who jointly owes the debt.
    2. Pay the debt in full inside the plan so your co-debtor does not have to pay.
  8. What non-exempt property must you pay the value of? If you own property that is not exempt, then you will pay the value of the property to the Trustee. If you file a Chapter 7, this property would be taken as well as sold by the trustee to pay your debts.

Conway Bankruptcy Testimonials

five star review

Brandon made it super easy to work with him on my bankruptcy. He offered me $0 down and made all my stuff was taken care of.

- Drey McNash via Google

Why should I file Chapter 13 if I qualify for Chapter 7?

If you are behind on your payments and you want to keep that property, then you need to file Chapter 13 instead of Chapter 7. Chapter 13 lets you stop foreclosures and repossessions, and lets you catch up on your payments. If your car was recently repossessed, then you can get it back.

Chapter 13 may save you money. Sometimes you can lower the amount you owe on your car if you purchased the care more than 910 days before you file bankruptcy. Also, you can lower your interest rate on your loan.

What if you don’t have the money to pay a bankruptcy lawyer? A Chapter 13 is cheaper to file. When you file a Chapter 13, you make your payment to the bankruptcy trustee and they pay your lawyer fees.

Get Started Today!

Brandon Haubert Arkansas Lawyer

Brandon Haubert is an experienced bankruptcy lawyer in Little Rock. Click to learn more and schedule a free consultation today!

wh Law, is a debt relief agency. We help people file for bankruptcy protection under the U.S. Bankruptcy Code.

Bankrupty Blogs

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July 7, 2020

Is Chapter 13 bankruptcy better now?

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April 6, 2020

Filing Bankruptcy without Leaving Your Home

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March 18, 2020

How much does a car loan cost? Options in bankruptcy

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February 19, 2020

What is a DSO (Domestic Support Obligation)?

What is a DSO (Domestic Support Obligation)? Section 101(14A) of the Bankruptcy Code defines a domestic support obligation as “a debt that accrues before, on, or after the date of the order for relief . . . including interest that accrues on that debt as provided under applicable non-bankruptcy law . . that is – A.  owed to or recoverable…

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January 28, 2020

Business Payday Loans and How they Work

The Small Business Ray Jones owns a small construction business, Ray’s Remodeling, LLC, which specializes in residential remodeling.  He pays his employees and buys his supplies in cash each month, incurring no trade debt.  Ray becomes sick and is hospitalized for weeks and in recovery for months.  He is not able to work and when he is not able to…

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January 2, 2020

Help! My tax refund is being garnished!

Who can garnish my tax refund? There are four types of debt for which the federal government will withhold your tax refund or send it to one of your creditors. These debts include past-due federal taxes, state income taxes, child support payments and amounts you owe to other federal or state agencies, such as federal student loans or medical debt…

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July 30, 2019

Bankruptcy Means Test | Are You Eligible?

The “Means Test” what does it all mean? The bankruptcy means test is used decide to see who is eligible for a Chapter 7 bankruptcy. People often are worried about the means test, but it is not as bad as it seems. If you make less than the median income for the state, here is a link to the numbers,…

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July 23, 2019

Bankruptcy Discharge: What Is It and When Does It Happen?

At the end of your bankruptcy, you get a discharge – a court order that relieves you from your obligation to pay your debts. You get a discharge at the end of your Chapter 7 or Chapter 13 bankruptcy only after completing all of the requirements for your case. The benefit of a discharge is that your creditor can never…

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July 9, 2019

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Bankruptcy and Unsecured Debt

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