Bankruptcy is a legal proceeding designed to protect consumers from creditors. It lets consumers reorganize and/or eliminate their debt. Because federal law provides the right to file bankruptcy, cases are handled in federal court. There are several types of bankruptcy. The most common are Chapter 7 and Chapter 13. If you are a family farmer or business owner, ask an attorney about other types of bankruptcy that might be available to you.
Chapter 7 bankruptcy is often referred to as a liquidation. It does not involve a monthly payment to creditors. In a Chapter 7, most unsecured debts are eliminated. The individual filing for bankruptcy can choose to reaffirm secured debts. It usually takes no more than 6 months before the debtor receives a discharge. Chapter 13 bankruptcy is often called a reorganization.
In a Chapter 13, most secured debts may be restructured or given special payment provisions. This is done so a debtor can afford to catch up on past-due payments and keep those things that are necessary for life.
This section contains links that offer information about protections about bankruptcy law and other financial resources. There are pdf fact sheets, pdf forms, streaming video and other resources to help you better understand your rights and obligations provided by both Arkansas and Federal law. Select a different topic here.
- "Bankruptcy (Spanish)"
- "Bankruptcy FAQ" * PDF by National Consumer Law Center (NCLC)
- "Bankruptcy Fees" * PDF by Bankruptcy Court
Check these websites for other potentially helpful information. These websites are maintained by other organizations:
Bankruptcy Basics. See this thorough overview, with videos, of the bankruptcy process and banktruptcy types.
Stateside Legal (for military members, veterans and their families)
Note: these are Adobe Acrobat PDF files. You may need to download the Adobe Acrobat Reader to view them.