Best Bankruptcy Lawyers in Arkansas

About Bankruptcy Law in Arkansas, United States

Bankruptcy is a legal process that allows individuals, families, and businesses struggling with overwhelming debt to either eliminate or reorganize what they owe under the protection of the federal bankruptcy court. In Arkansas, as elsewhere in the United States, bankruptcy law is primarily governed by federal statutes, but there are important state-specific rules and exemptions. Filing for bankruptcy in Arkansas offers eligible debtors relief from collection efforts, wage garnishments, and potential foreclosure, allowing them to regain financial stability.

Why You May Need a Lawyer

Bankruptcy can be a complex and emotionally challenging process. Here are some common situations where having a lawyer is beneficial:

• You are unable to keep up with bills and creditors are calling or suing you.
• You are facing foreclosure or repossession of property.
• You want to stop wage garnishment or bank account levies.
• You are unsure whether your debts qualify for discharge.
• You need help understanding whether to file Chapter 7 or Chapter 13 bankruptcy.
• You own significant assets and want to protect as much as possible under Arkansas exemptions.
• Your income is above the median level and you are concerned about the means test.
• You have complex financial obligations such as back taxes, child support, or business-related debts.

A bankruptcy lawyer can explain your rights, help you choose the best type of bankruptcy, manage required paperwork, and represent you in court proceedings.

Local Laws Overview

Arkansas follows federal bankruptcy guidelines but has its own set of exemptions that determine what property you may keep when you file. Notably, Arkansas residents can choose between using the federal exemption list or the Arkansas state exemptions. Key points include:

• Homestead Exemption: Arkansas offers a generous homestead exemption, allowing most filers to protect their primary residence up to a certain acreage or value.
• Personal Property: Specific protections exist for items such as clothing, furniture, and tools of trade.
• Vehicle Exemption: There is a cap on the value of vehicles that can be exempted.
• Choice of Exemptions: Filers must choose between Arkansas state exemptions and federal bankruptcy exemptions. Mixing and matching is not allowed.
• Means Test: Those considering Chapter 7 bankruptcy must pass a means test, which compares your income to the median income for Arkansas households of your size.
• Mandatory Credit Counseling: Before filing, you must complete a credit counseling course from an approved provider.
• Bankruptcy Courts: Arkansas has two bankruptcy districts - the Eastern and Western Districts. Each district maintains its own court locations and procedures.

Your choice of exemptions and district may affect the outcome of your case, so local knowledge is important.

Frequently Asked Questions

What types of bankruptcy are available in Arkansas?

The most common types are Chapter 7 (liquidation) and Chapter 13 (reorganization for individuals). Some businesses may also file Chapter 11.

Will I lose my home if I file for bankruptcy in Arkansas?

Many people are able to keep their homes by using the Arkansas homestead exemption or by filing Chapter 13, which allows for repayment plans. Your ability to keep your home depends on the equity in your property, your exemptions, and whether you can stay current on payments.

How long does the bankruptcy process take in Arkansas?

Chapter 7 cases typically take three to six months from filing to discharge. Chapter 13 involves a repayment plan that lasts three to five years.

Can all debts be discharged in bankruptcy?

No. Certain debts such as child support, some taxes, alimony, student loans, and court fines typically cannot be discharged.

How much does it cost to file bankruptcy in Arkansas?

Costs include court filing fees (about $338 for Chapter 7 and $313 for Chapter 13) and attorney fees, which vary by case complexity and location.

What property can I keep if I file bankruptcy?

Your ability to keep property depends on Arkansas and federal exemption rules. Most people can keep essential assets such as a home, car, and personal belongings up to specific values.

Will bankruptcy stop creditors from calling me?

Yes. Once you file, an automatic stay goes into effect that requires most creditors to stop collection activities, including calls, lawsuits, garnishments, and foreclosures.

Can bankruptcy stop a foreclosure or repossession?

Bankruptcy can temporarily halt a foreclosure or repossession. Chapter 13 may allow you to catch up on past-due payments over time. Chapter 7 may delay, but not prevent, asset seizure in some cases.

Do I have to go to court if I file bankruptcy?

All filers must attend at least one hearing called a 341 meeting of creditors. Most cases do not require additional court appearances unless there are disputes.

How will bankruptcy impact my credit?

A bankruptcy filing will appear on your credit report for up to 10 years (Chapter 7) or 7 years (Chapter 13). While it lowers your credit score initially, many people can rebuild credit within a few years.

Additional Resources

If you are seeking guidance on bankruptcy in Arkansas, the following resources can provide valuable information or assistance:

• United States Bankruptcy Court - Eastern and Western Districts of Arkansas
• Arkansas Legal Services
• Arkansas Attorney General's Office
• Consumer Credit Counseling Services of Arkansas
• Local legal aid clinics and bar associations
• National Foundation for Credit Counseling
• Department of Justice - United States Trustee Program

Next Steps

If you believe bankruptcy might be the right option for you, consider the following steps:

1. Gather financial documents such as pay stubs, bank statements, tax returns, and information on your debts and assets.
2. Consult with a bankruptcy attorney who is licensed and experienced in Arkansas law to discuss your options and determine your eligibility for various bankruptcy chapters and exemptions.
3. Complete the required credit counseling course through an approved provider.
4. Work with your attorney to prepare and file your bankruptcy petition with the appropriate district court.
5. Attend your 341 meeting of creditors and follow any instructions given by the court or your attorney.
6. Take the debtor education course required for discharge.
7. Stay in regular contact with your attorney to ensure all deadlines are met and to address any issues that arise.

Bankruptcy is a significant legal step, but with the right guidance and resources, it can offer a path to a fresh financial start.