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Bankruptcy in Arkansas

Who can file for bankruptcy in Arkansas?

In order to be eligible to file for bankruptcy in Arkansas you must meet the following requirements.

  • You must have been a resident of the state of Arkansas for at least one year
  • You can not have filed for bankruptcy in any jurisdiction in the last 6 years
  • You must have unsecured debt
  • You must participate in credit counseling

If you do not meet all of the requirements listed above, you will need to consult with your bankruptcy attorney to determine if and when you will be permitted to file for bankruptcy relief in the state of Arkansas.

If you live in the eastern district of Arkansas you will be required to file your bankruptcy petition with the federal court in Little Rock.  If you live in the western district of Arkansas you will need to file your petition with the federal court in Fayetteville.

How do I know if I am eligible for Chapter 7 bankruptcy?

In order to determine whether or not an individual is eligible to file for Chapter 7 bankruptcy, the state of Arkansas will apply a means test in accordance to federal and state law.  This means test requires that your annual income for the year prior to filing bankruptcy be compared to that of the average income in the state of Arkansas.  If your income is above the average income for your state, you will not be eligible to file for Chapter 7 bankruptcy.  If your income is below the average income for your state, you will be permitted to move forward with your Chapter 7 bankruptcy case.

If I file for bankruptcy will my spouse be effected as a result?

You can choose to file bankruptcy without your spouse however, if you and your spouse have joint debts, your claim of bankruptcy will not eliminate your spouse’s responsibility to pay those debts.  In addition to your spouse still being responsible for any joint debts, the discharge of your responsibility of these debts may still show up on your spouse’s credit report.  By choosing to file bankruptcy together, both spouses debts may be discharged, and you will be able to double your eligible exemptions.

What are Arkansas  property exemption laws?

When filing for bankruptcy in Arkansas you can choose between the Arkansas property exemption rules or the federal exemption rules.  Deciding which of these sets of exemptions will be most beneficial in your situation is a decision which should be discussed with your bankruptcy attorney.  Depending upon which set of exemptions you choose to proceed with, you will be allowed to protect a certain amount of equity in your home and vehicle.

What do I need to do before I can file for bankruptcy?

Before you are file for bankruptcy there are three steps which you must take.  The first is to contact a bankruptcy attorney in your area.  Having the counsel of an experienced bankruptcy attorney will prove to be invaluable during this time in your life.  The second is to gather information concerning all of your debts and assets.  This information will be required at the time when you file for bankruptcy.  The third is to sign up for an approved credit counseling course.  This is a prerequisite for all people who are seeking bankruptcy relief.

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