Bankruptcy Overview

What isBankruptcy?

What Is Bankruptcy? | Tucson, AZ Bankruptcy Attorney | Mesa, AZ Bankruptcy Lawyer

Bankruptcy is the legal procedure that allows individuals, businesses, and other organizations to get relief from burdensome debts, either by modifying the repayment schedule, reducing the debt, or eliminating it altogether. Precisely what kind of relief is available with respect to a particular debt depends on the nature of the debt (e.g. is it a secured debt like a mortgage, or unsecured debt like a credit card balance), the type of bankruptcy, and several other factors that vary based on individual circumstances.

Bankruptcy law is federal law, and is provided for in the United States Constitution, Article 1, Section 8. A bankruptcy case is filed in a United States Bankruptcy court.

Consumer Bankruptcy

The two main objectives of consumer bankruptcy are to give the debtor a fresh start, and to pay creditors as much as possible without unduly burdening the debtor.

The first of these objectives is accomplished through the bankruptcy discharge,which releases the debtor from personal liability for specific debts and prohibits creditors from ever taking any action against the debtor to collect those debts

The second objective is accomplished by the automatic stay, which prevents most creditors from taking any action to collect a debt once a bankruptcy is filed, and by the bankruptcy laws and rules that lay out how much of a debtor’s property may be taken by creditors, and in what order the creditors get paid.

Types of Consumer Bankruptcy

• Chapter 7 – Liquidation
• Chapter 13 – Debt Adjustment

Business Bankruptcy

Business bankruptcy serves one of two purposes. It allows businesses undergoing temporary financial struggles, but wishing to continue operating, to effectively by scturing and modifying their debts, thus preserving the business’s going concern value.

For businesses wishing to wind up their operations, business bankruptcy allows for an orderly liquidation, with the business owners retaining primary control over the timing and disposition of the business’s assets. Business bankruptcy cases are primarily filed under Chapter 11 – Business Reorganization.

Our Bankruptcy Process

If you are struggling with debt, we are here to help with the bankruptcy process. In fact, there are only three simple steps to a life free of worrying about debt. Read on to learn more.

Step 1 — Schedule a Consultation to Learn About the Bankruptcy Process

Please bring the following documents with you to the consultation:

• The Bankruptcy Questionnaire, which you can find here.
• Your paystubs for the last 6 months. If you are married, we also need to see your spouse’s paystubs for the last 6 months.
• A recent statement for each mortgage.
• A recent statement for each vehicle loan.
• Documentation for any other secured debt.
• Documentation for any tax liabilities.
• Information on all other debt you have, including credit cards, medical bills, personal loans, payday loans, etc. At a minimum, we need to know approximately how much you owe for each type of debt.
• A list and value of your property and assets. Property and assets includes anything that has value. While we do not need a list of your household belongings and furniture at the first consultation, we do need to know about any bank accounts, investments, timeshares, guns, jewelry, musical instruments, and other valuable items.
• If you own and operate a business, we will need, at a minimum, your financial statements for the current and prior year, and a list of the business assets. When you schedule your consultation, please ask us what else we need to see for your business.

Step 2 — Determine the Best Solution

We will evaluate your situation using the documents and information that you bring in. We will then discuss the applicable types of bankruptcy, including Chapter 7, Chapter 13, and Chapter 11, and the benefits you can receive from each. If appropriate, we will also discuss non-bankruptcy alternatives, like debt settlement, negotiation, or state court litigation. We will then explain which option will be best in your situation, and why. Our goal during this step is to make sure that you clearly understand all your options, and that we answer any questions you may have.

Step 3 — Enjoy a Peace of Mind

Once you retain us, we will take care of all the legal work and the preparation of all the court documents, so that you can enjoy a peace of mind. In addition, once we start the bankruptcy process, you can refer all your creditors to us, and we will deal with them on your behalf.

Bankruptcy Costs and Fees in Tucson and Mesa

If you are considering filing for bankruptcy, the bankruptcy cost is no doubt a very important consideration. After all, if you had unlimited funds, you wouldn’t be filing for bankruptcy, right? We understand that, and our goal is to provide you with the best legal services in the most cost-efficient manner. There are several costs when it comes to bankruptcy. Some of these are fixed. These include the court filing fee (currently $338 for Chapter 7, $313 for Chapter 13, and $1,738 for Chapter 11) and a credit report ($45 per person, needed only for personal/individual bankruptcies). If you are an individual, you will also need to do credit counseling before and after filing for bankruptcy ($15-35 per session, depending on which credit counseling company you choose). Lastly, of course, there is our attorney fee, which covers consulting you on all aspects of the bankruptcy process, preparing all bankruptcy documents, and representing you during the bankruptcy process.

Bankruptcy Cost Is Dependent On The Kind Of Bankruptcy

We handle cases on both a flat fee and an hourly fee basis. If you are doing a Chapter 11 bankruptcy, your case will almost always be on an hourly fee basis at the then-current rates. Chapter 11 cases are generally too complex to allow for a flat fee structure. However, we will provide you with an estimate of the anticipated cost of your chapter 11 case.

All Chapter 7 bankruptcies, and almost all Chapter 13 bankruptcies, are handled on a flat fee basis. This gives you the benefit of knowing in advance exactly what the cost of the bankruptcy will be. Unlike the so-called “bankruptcy mills,” which you may see advertising a “flat Chapter 7 fee,” we do not charge a single rate for all cases. The reason for this is simple. Each case is different and presents circumstances that may require more or less work on our part. For example, some clients have little debt, while others have dozens of creditors and hundreds of thousands in debt; some have a modest income, while others may have above-median income requiring additional means-testing to qualify for bankruptcy; some may have car loans that they need to reaffirm, while others may not. Each of these factors will affect the amount of work needed to provide you with quality legal services. It would be unfair to you to charge the same rate regardless of whether your case was simple or complex. If a firm charges the same rate for all cases, inevitably, you will either be overpaying for what you need, or will not be receiving the services that you really need. To see why that is, ask yourself the following:

Would you expect a car mechanic to advertise a single price for any car repair? Of course not. In fact, if you were to see such an advertisement, you would be very suspicious of that mechanic, and rightfully so. Legal services are no different. While there may be general similarities between Chapter 7 bankruptcies, for example, no two cases are alike, and each requires an individualized approach. And the consequences of inadequate legal representation are much more serious. A botched car repair will leave you, at worst, with an inoperable car. An improperly done bankruptcy can have much more serious consequences, including loss of assets, denial of your discharge, and, in the worst cases, criminal prosecution.

Because each client’s case is unique, you deserve that your case be treated with the utmost attention. For this reason, we provide a free consultation. The consultation allows us to review your financial situation in detail, and to discuss any issues that may be of particular concern to you. Based on the information we obtain during this free consultation, we will provide you with the cost of representing you in your case, in a manner that gives individualized attention to your circumstances and that maximizes the benefits of bankruptcy to you. There is no obligation on your part to retain us after the consultation. Our approach may be more time-consuming than simply quoting a standard fee, but we believe it is the only way to provide you with the kind of service, and the fresh start, that you deserve.

We understand that bankruptcy is often a difficult decision, and you need to both be comfortable with the attorney, and have an affordable way to pay for the bankruptcy. For this reason, we provide several benefits and assurances:

Money back guarantee: This applies to Chapter 7 and Chapter 13 cases. If the court does not accept your bankruptcy petition because of an error on our part, we will refund the entire attorney fee that you paid to us.

Payment plans: For both Chapter 7 and Chapter 13 clients, we offer payment plans to make the payment of fees more affordable.

$0 down: For qualifying Chapter 13 cases, we provide a $0 down option, which allows you to pay our fees after the bankruptcy is filed. Please note that this does not include the cost of the filing fee, credit report, and credit counseling, which will need to be paid before filing.