Chapter 7 Bankruptcy

Chapter 7 Bankruptcy

Commonly referred to as “liquidation,” Chapter 7 bankruptcy is available to people whose income does not meet certain thresholds. In this type of bankruptcy, the debtor’s non-exempt assets are liquidated into cash and a trustee distributes that money to creditors. Usually, there are few non-exempt assets.

How Does Chapter 7 Bankruptcy Work?

When your Chapter 7 bankruptcy case is filed, a trustee is appointed by the court. This trustee – who may or may not be a lawyer – is responsible for reviewing your bankruptcy papers to be sure that you have not hidden anything, did not lie, and made all required disclosures.

You will be called for a meeting of creditors within 4-6 weeks of when the case is filed. This is a very informal meeting with the trustee and takes about 10-15 minutes. You will be asked a series of questions about your case, and the trustee will review the documents that have been filed with the bankruptcy court.

Don’t worry about the meeting of creditors. Why? Because:
1. Creditors seldom – if ever – show up; and
2. One of our lawyers will be there with you to help you understand the process and to represent you during the meeting.

Once your meeting of creditors is completed, you will be required to complete a brief financial management certification course. Most people do this over the phone or online, and it helps you think about how to avoid financial problems in the future. Your Discharge of Debtor is issued about 4 months after the case is filed, and releases you from all of your dischargeable debts. Think about it – four months from now, you could be debt-free.

How Long Does It Take?

Arkansas Chapter 7 bankruptcy cases can be completely finished in approximately four months – sometimes even faster than that.

Of course, in order for the bankruptcy case to be completed quickly, it is important that you do the work needed to get the proper documents to our office. Those documents help us prepare a correct petition immediately, speeding up the process. If there are mistakes or inconsistencies, the Chapter 7 bankruptcy trustee may keep the case open to verify information or look into any issues.

In some difficult cases, if issues arise or there are assets in the case, there is no set answer to when a case will be closed. The bankruptcy trustee may take months or years to review additional documents and conduct an examination of assets. That may or may not interfere with your ability to get a Discharge in Bankruptcy. However, most cases are considered no-asset cases where the trustee does not administer any of your property.

If a case seems to be taking a long time to finish, call our office to talk with one of our staff members. If you have any questions along the way, give us a call so we can ensure you understand what is going on with your case.

Will I Lose My Property?
Most people who file for Chapter 7 bankruptcy in Arkansas do not lose any property. That’s because the law allows you to keep many types of property when you file for Chapter 7 bankruptcy in Arkansas. Different states have different rules.

If our analysis of your situation shows that you would lose property in Chapter 7, we will let you know before your case is filed. You may decide that it’s worth it to give up something in exchange for a discharge of your debts. If not, however, there are other options, such as Chapter 13 bankruptcy, to help you.

What To Bring?

Filing for bankruptcy in Arkansas can be simple in the right hands. That’s why when you meet with Mr. Crawley at Crawley Law Firm, you are asked to bring certain documents and information for us. With the right information, we can get to the heart of your problem quickly and effectively, giving you the help, you need. When you come for your consultation, you will need to bring several documents.

  1. Driver’s license
  2. Social security card
  3. Paystubs – Last 6 months
  4. Bank Statements – Current month and past two months
  5. Tax Returns – 2017, 2018, 2019, 2020
  6. State Tax Returns – 2017, 2018, 2019 & 2020
  7. 2020 W2
  8. Personal Property Assessment – Most recent
  9. Vehicle registration – Only for ones you owe money on
  10. Proof of vehicle insurance

We will pull a credit report, but we will need a list of creditors for any not on there (name of creditor, address and amount owed)

You can get one FREE annual credit report from all three credit reporting agencies (Experian, Equifax, and Transunion) by going to www.annualcreditreport.com or by calling 877-322-8228.
If we need any further information, we will let you know.

Chapter 7 And Your Credit Score

Chapter 7 bankruptcy can take a huge toll on your credit rating, but luckily by the time your debts are discharged, you’re in a better financial position than before. You’ve hopefully also gained the budgeting and planning skills to make a recovery possible. The basic steps for rebuilding credit are simple; they just require some patience and discipline. The following are some options for acquiring loans and strategies for making the most of them.

Recording Credit Builder Loans
This is a very basic type of loan whose sole purpose is to build your credit. They’re usually offered by small community banks and credit unions. How it works is: you apply for a loan and are approved, but the amount of the loan is deposited in an account. You then make monthly payments determined by the length of the loan, and the bank reports those payments to credit rating agencies, boosting your score. Since there is no risk to the financial institution, approval is very likely. Any missed payments would be reported as well, so make sure you never miss any.
Reporting Secured Loans and Credit Cards
These options work similarly. Cash is deposited in a savings account or CD, and a loan is issued equal to the amount of the deposit. You usually won’t be able to access the money until the loan is paid off, but each payment will be reported to the credit agencies so your credit will improve. Your money will continue to earn interest while in the savings account or CD, and because the risk is low to the lender, the interest rate on loan will be very low.
Rebuilding With Unsecured Loans and Cards
After your credit has been rebuilt somewhat, you’ll be able to apply for an unsecured credit card or loan. Because your score will likely still be low and the bankruptcy still on your report, your options will be limited. The best place to start is with the bank that held your secured loan or credit card. They have experience with you as a customer and are more likely to approve of you. Store cards (retail credit) are other easy-to-obtain cards because they can only be used at the store that issues them, limiting the risk of them being misused. Be aware, though: interest rates tend to be very high on these cards, so carrying a balance is especially harmful.
Rebuilding With Payment Strategies
Initially, you’ll want to make every payment in full every month. Especially on secured cards and loans, this is vital. Once you’ve obtained an unsecured loan, experts recommend not using more than 30% of your available credit limit and paying it off every month in full. After a year of doing this, you can call your financial institution and request an increase in your credit limit. At this point, some people find it beneficial (and some experts recommend) carrying a small balance from month to month. If this is the route you choose, the balance should not be more than 20% of your available credit.
These steps take some time, up to three or four years, to fully take effect. Your patience and diligence will be worth it when you see your credit score increase by up to 100 points.
Best Bankruptcy Attorney

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Crawley Law Firm can assist you and answer any questions you may have about filing Chapter 7 Bankruptcy. Reach out to set up a free consultation with a bankruptcy attorney.

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Reviews

Crawley Law Firm, PA

Customer Reviews

H Barnes

Awesome. Answered every question each time all the time. Be prepared when you walk into his office because they're already waiting to tackle your issues. Good staff too. This lawyer gets this thang done. Have your ducks in a row.. They will help you all the way.

Mr. and Mrs. Dowdy 08/19/2022

We want to personally thank Mr. Crawley and his staff for everything. We want the whole office know we appreciate each of you for being kind and having patience with us throughout the process.

C. Henley

I have been struggling with coming to this decision to file bankruptcy, but you have made me feel comfortable through this process! Thank you for being so great with clients! You are a rockstar in my book! This is terrifying but you all have made it better! Thank you for all your help!!

Terri B. 01/20/22

Google
I would definitely recommend Crawley Law Firm. They were informative and very patient all the way through. I could always call with any other questions. Juliana was great! Michael and all of his staff were very professional and understanding all the way!

Robert N. 01/17/22

Google
Very responsive very respectful, and competitive on price. Always answered my questions with honor. Thanks Crawley team.

Sherry S. 01/12/22

Awe ty for always making me feel better. You are good people and I can't tell you how every single thing u have ever said or done u and ur hubs has helped us in some way. And this bankruptcy stuff is serious and ya'll take such good care of us and we appreciate you!

Brandy T. 12/23/21

Thank u so much y'all are so pleasant and beautiful people to work with.

Tonya D. 12/27/21

Google
Mr Crawley and all of his staff were extremely nice, truly caring and always there to help. I am very fortunate to have been able to work with all of them. Anytime you have a question all you have to do is call or email. They would ALWAYS get right back with you. If you need a GREAT attorney....Definitely give them a call!!!

Tonya.

Update: 12/27/2021

These people are awesome to work with. They don't just take care of you at the beginning and leave you to deal with stuff and you be lost. They are with you every step of the way. Even after it is all said and done they are a phone call, text or email away. You have multiple ways to stay in contact and they make you very comfortable asking any questions you may have. I highly recommend Mr Crawley and all of his staff. They are amazing. They are the best so please give them a call. I did and they also give you information to help you rebuild your credit. So they go above and beyond for sure. Happy New Year's and be sure you pick the right one when needed.

Arnold B. 11/04/21

They treat you like your someone; with understanding and caring ,really good folks i trust them you can too

Tonya D. 10/29/21

Google
Mr Crawley and all of his staff were extremely nice, truly caring and always there to help. I am very fortunate to have been able to work with all of them. Anytime you have a question all you have to do is call or email. They would ALWAYS get right back with you. If you need a GREAT attorney....Definitely give them a call!!!
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