Bankruptcy in Arkansas

Now that you're ready to file for bankruptcy in Arkansas, it will benefit you to learn a bit more about how the process works as well as the exemptions involved. Bankruptcy can be a complicated procedure in any state, so make sure that you hire an attorney that has experience in this specific field if you want the best results. The first thing you need to know is that you are required to be in a credit counseling program for at least 6 months before filing, so this is your first step if you have not yet done so.

The Acts Means Test

Due to the 2005 Bankruptcy Act, when you file for bankruptcy your current financial status will be closely examined when you file for bankruptcy in Arkansas. This includes an analysis of both your income and expenses in order to see if you are eligible for Chapter 7, or if you are only eligible for Chapter 13. In order to perform this test, the court will examine your earnings for the past six months before you filed, as well as the income that your family took in for the past six months. The total will them be compared to the median income in the state of Arkansas.

Arkansas exemptions for bankruptcy

When filing for bankrupt in Arkansas, you will be given certain exemptions that you don't have to worry about losing to your creditors. This is important because you don't want to be left with nothing after all. Exemptions are the largest difference in bankruptcy laws between the different states in the country. The exemptions for the state of Arkansas include homestead, insurance, wages, and personal property for example. For a homestead, you may declare either a rural home up to 160 acres or an urban homestead up to one acre. Insurance includes payments from annuity contracts, disability benefits, fraternal societies, group life insurance, and so on. Personal property includes: burial plots, clothing, vehicles up to $1,200, and wedding bands with diamonds that do not excess one half carat.

Filing for Bankruptcy

Once you've gathered up the paperwork that documents your income, expenses, and property, you are ready to file your bankruptcy claim. This can be filed at the Arkansas district bankruptcy court along with the other required paperwork. The cost for Chapter 7 Bankruptcy is $274 in this state. If you don't have the entire sum, you may make regular payments until it is paid off.