Bankruptcy in Arkansas is a legal process through which some of the debts of an individual or a business are absolved (excused). You should not view bankruptcy as an opportunity to eliminate your debts just because you don't feel like paying them - it can be a long and difficult procedure. Bankruptcy is designed to be a last resort to prevent complete financial ruin, while allowing creditors to collect at least some of their debts in an orderly fashion. Filing for bankruptcy can have major negative effects on one's credit score, which will make it more difficult to get loans in the future.
Accordingly, if you are considering bankruptcy as an option, you need to thoroughly examine the costs and benefits. A good Arkansas bankruptcy lawyer can advise you as to the pros and cons of bankruptcy, and give his or her expert opinion about whether or not bankruptcy is a good option, based on the facts of your individual case.
Types of Bankruptcy in Arkansas
Bankruptcy is governed by federal law, so the procedures in filing for bankruptcy in Arkansas will be the same as everywhere else in the United States. There are 2 basic forms of bankruptcy that consumers typically use: Chapter 7, and Chapter 13, owing their names to where they are found in the U.S. Bankruptcy Code. Additionally, there is a form of bankruptcy typically used by businesses called Chapter 11. Chapter 11 is available to individuals, but it is rarely the best option for them.
In Arkansas, Chapter 7 bankruptcy is known as "liquidation." When a person files for Chapter 7 bankruptcy, a trustee is appointed by the bankruptcy court to do an accounting of the debtor's property. The trustee then determines what pieces of property, if any, should be sold off to pay off the debts. Many forms of property are exempt from forced sale up to a certain dollar amount, including houses, cars, and retirement accounts. Once the property is sold, any remaining dischargeable debt is eliminated. Chapter 13 bankruptcy involves restructuring, rather than discharging, one's debt. Essentially, the court structures a debt repayment plan meant to allow the debtor to pay off his or her debt in manageable installments, while allowing the debtors to eventually collect at least some of what is owed to them.
Chapter 11 bankruptcy is typically used by businesses. It also involves reorganization of debts, similar to chapter 13 bankruptcy. It requires the debtor company to come up with a reorganization plan, which its creditors must vote on for approval. If it is approved, the company will then be legally obliged to carry it out.
How Can a Arkansas Bankruptcy Lawyer Help?
Making the decision to file for bankruptcy can be extremely difficult, given the potential consequences. An Arkansas lawyer specializing in bankruptcy can advise you of the likely consequences you will face if you file, and help you determine if they are outweighed by the potential benefits.
Interesting Facts About Arkansas
Arkansas nicknamed "The Natural State", in reference to its many natural geographic features. It is sometimes known by its former nickname of "the Land of Opportunity". Arkansas has a population of nearly 3 million people, and the state capital city is Little Rock. Some counties in Arkansas have two county seats.
Legal claims in Arkansas are processed through the state's judicial branch. This consists of the Arkansas Supreme Court, Court of Appeals, and Circuit Courts. There are also District Courts and City Courts, which do not conduct any jury trials. Thus, many legal claims are processed at the Circuit Court level. The Arkansas Supreme Court building also houses a library and is noted for its beautiful rotunda layout.
One of the most famous U.S. Supreme Court cases, United States v. Miller, originated in Arkansas. The Miller case involved the 2nd Amendment, specifically with regards to registration of firearms for tax purposes. The Miller decision is a key case in America's ongoing gun control debate, and is often cited by both sides of the debate.
Lawyers in Arkansas provide legal advice, assistance with legal forms, and representation in court. Arkansas laws are very specific to the region, and Arkansas lawyers understand how to interpret the laws for you. An experienced Arkansas attorney can help you through the legal process from beginning to end.