At Phoenix Fresh Start Bankruptcy Attorneys, our team works with a diverse group of clients with a variety of debt problems. This is Part Two in a series on some of the most common worries that we are told are in the back of our clients minds before they visit one of our Phoenix Bankruptcy Law Offices for a free consultation.

Won’t Everyone Who Knows Me Going to Find Out About My Bankruptcy Filing?

The fact is your bankruptcy will go on the public record. But I would argue that the worry about privacy is completely misplaced.  First of all, someone would really have to seek out the information to find it. The bankruptcy filings are not exactly on the front pages of the Arizona Republic. To even find your bankruptcy filing, someone would have to go looking for it and dig pretty deeply into the classified section of a low circulation small paper. Frankly, most people are too busy or preoccupied with their own concerns to do that.

Secondly, and much more importantly, bankruptcy just doesn’t bear the same stigma that it did when I started out eighteen years ago. The reality is that these day, pretty much everyone has a family member, co-worker or boss that has filed already. When I started filing cases eighteen years ago, bankruptcy as a shameful act. I kept a box of tissues on my desk for every appointment.  It’s just not that way anymore.

 Do I Need Help with Bankruptcy, or Can I Go It Alone?

There is a great deal of money on the line. I have been practicing bankruptcy for eighteen years and I learn something new every week. Is this really something that you want to learn on the fly. Everyone thinks they have a simple case(literally everyone) and they know someone who filed on their own and nothing bad happened. Is that really what you want to hang your hat on? This is literally your future on the line.

Perhaps more than any other area of law, bankruptcy is an intersection of state and federal law. A federal statute governs bankruptcy proceedings, but state and local laws and regulations also govern how cases play out. So you might find a website where some “expert” breaks down how to file for bankruptcy, and you use that information as his guide.

Problem is that site is not Arizona specific. Something that may be generally true in bankruptcy for most of the country is not true here. For example, most of the country accepts the federal bankruptcy exemptions which, among other things, protect a large portion of a personal injury awards. But Arizona rejects the federal exemptions. So when you rely on internet “experts” you do so at your own peril.

Filing on your own is short sighted. Filing bankruptcy the wrong way – even the slightly wrong way – can result in the loss of assets that you could have preserved and extra expenses, not to mention loss of peace of mind. Keep in mind when you file a Chapter 7 bankruptcy, you don’t get to walk away from the table if it does sideways.

Finally, think of bankruptcy holistically. This should not a “one and done” where you are at best just moving debts from column A to column B. This is the time for a true fresh start, a time to get it right, break the downward spiral and rebuild your credit score, so  put pride aside, and do this the right way!

Does Chapter 13 Bankruptcy Discharge Debt of Just Reorganize It

When reading about Chapter 13 bankruptcy, many of our prospective Phoenix bankruptcy client hear the term “reorganization” and assume that the Chapter 13 Bankruptcy process will result in their debt being moved around and made easier to pay by giving them more time to pay it all off. But the reality is so much better than that!

In fact, the process will result in the same discharge of unsecured debt that you see in Chapter 7. Often our clients actually pay less to their creditors than they would have if they had filed Chapter 7. How is this possible if Chapter 7 is just a straight discharge where you don’t pay anything back?

The reality is that many of our Chapter 13 filers don’t pay anything back on their credit card or medical debt at all just like a Chapter 7 filer. But unlike a Chapter 7 filer, they get the added advantage of improving their car loans, paying back mortgage or tax arrears interest free and doing it all through a smoother, more risk free process than Chapter 7.

Even if you know that you are going to have to file Chapter 13 because you make too much money to file Chapter 7, it is still way better than a reorganization. Chapter 13 filers rarely pay it all back. Usually the worst case scenario is paying dimes or quarters on the dollar, interest free over a long period of time, through one monthly payment that allows you to get on with your life. Is that really something to dread and isn’t it a whole lot better than a reorganization?


Please set an appointment to see an attorney at Phoenix Fresh Start Bankruptcy if you have any concerns about filing bankruptcy. We would be happy to help separate the fact from the fiction and help you find a solution.