Topic guideUpdated 2026-02-27
Arizona Chapter 7 Bankruptcy — Eligibility & Process
How Chapter 7 works step by step — the means test, 341 meeting, discharge timeline, and what debts are eliminated.
How Chapter 7 works
1
Credit counseling
You must complete an approved credit counseling course within 180 days before filing. This is a federal requirement §11 U.S.C. § 109(h).
2
Filing the petition
Your attorney files the petition, schedules (lists of assets, debts, income, expenses), and a statement of financial affairs with the bankruptcy court. The Automatic stay takes effect immediately §11 U.S.C. § 362.
3
Means test
The court evaluates whether your income qualifies for Chapter 7 §11 U.S.C. § 707(b). If your household income is below the median for your state and household size, you generally pass. Above-median filers face a more detailed expense analysis.
4
341 Meeting of creditors
Weeks after filing, you attend a hearing where the trustee and any creditors can ask questions about your finances. The meeting is brief — the trustee asks basic questions about your petition.
5
Trustee review
The Chapter 7 trustee examines whether any non-exempt assets exist that could be liquidated to pay creditors. Many Chapter 7 cases are "no-asset" — the trustee finds nothing to liquidate.
6
Discharge
If no objections are filed, the court enters a discharge order after the 341 meeting period closes, eliminating qualifying debts §11 U.S.C. § 727.
What Chapter 7 can discharge
- Credit card debt
- Medical bills
- Personal loans and payday loans
- Utility arrearages
- Lease obligations (broken leases, early termination fees)
- Older judgments from lawsuits
What Chapter 7 cannot discharge §11 U.S.C. § 523
- Most tax debts less than 3 years old
- Child support and alimony
- Student loans (absent undue hardship)
- Debts from fraud or misrepresentation
- DUI/DWI injury judgments
- Court-ordered restitution
Arizona exemption protection
In Chapter 7, exemptions determine what property you keep. Arizona requires use of state exemptions.
- Homestead: $400,000 in equity (statutory base; adjusted annually for cost of living beginning January 1, 2024 — use the current indexed amount) §33-1101; §33-1102
- Personal property: $15,000 aggregate base (household furniture, furnishings, household goods including consumer electronics, and appliances) — adjusted annually for cost of living since January 1, 2024, so check the indexed amount for the filing year §33-1123
✓Chapter 7 filers who have protected all property with exemptions keep everything they own. The trustee only liquidates non-exempt assets, and strategic use of exemptions can protect what you own.
Timeline at a glance
- Filing to 341 meeting: weeks after filing
- 341 meeting to discharge: after the objection period closes
- Total time: approximately 3-4 months §11 U.S.C. § 727
- Credit report impact: remains for 10 years from filing date
⚠You cannot receive another Chapter 7 discharge within 8 years of a prior Chapter 7 filing, or within 6 years of a prior Chapter 13 filing (with exceptions).
Prepare for Your Consultation
Quick checklist (Bankruptcy)
If there is a deadline (garnishment / foreclosure), include dates.
Recent pay stubs
and income info
Debt list
(cards, loans, balances)
Collection letters
or court papers
General preparation tips only. Eligibility and timing depend on facts.
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Common Questions
Frequently Asked Questions
General answers to common questions. Specific outcomes depend on your facts and timing.
If you have a deadline, court notice, or upcoming hearing, mention it when requesting assistance so timing can be evaluated promptly.
Related guides
Legal authoritiesStatutes referenced on this page
11 U.S.C. § 727
Discharge in Chapter 7
Grants a discharge of most unsecured debts upon completion of the Chapter 7 case, with specific exceptions.
- Discharge typically occurs 60-90 days after the 341 meeting of creditors
- Cannot receive another Chapter 7 discharge within 8 years of a prior Chapter 7 filing
Verified 2026-07-13 · semiannual review
11 U.S.C. § 523
Exceptions to discharge
Certain debts survive bankruptcy: most tax debts less than 3 years old, domestic support obligations, student loans (absent undue hardship), and debts from fraud.
Verified 2026-07-13 · semiannual review
11 U.S.C. § 707(b)
Means test
Compares debtor's income to Arizona median to determine Chapter 7 eligibility.
Verified 2026-07-13 · semiannual review
11 U.S.C. § 362
Automatic stay
Filing immediately stops collection actions, garnishments, and foreclosure.
Verified 2026-07-25 · semiannual review
11 U.S.C. § 109(h)
Credit counseling requirement
Debtors must complete a credit counseling course from an approved agency within 180 days before filing.
Verified 2026-07-13 · semiannual review
A.R.S. § 33-1101; 33-1102
Homestead exemption
Protects $400,000 in equity (statutory base; adjusted annually for cost of living beginning January 1, 2024 — use the current indexed amount) in the debtor's homestead.
A.R.S. § 33-1123
Personal property exemption
Protects $15,000 aggregate base (household furniture, furnishings, household goods including consumer electronics, and appliances) — adjusted annually for cost of living since January 1, 2024, so check the indexed amount for the filing year.
Verified 2026-09-23 · quarterly review
Read with A.R.S. § 33-1101: A.R.S. § 33-1102 ↗
Citations link to official or authoritative sources. Laws change — verify current text before relying on any statute. How we verify citations →