Understanding Chapter 13 Bankruptcy in Arizona

Reviewed by: Casey Yontz, Attorney (18+ years bankruptcy experience)

Last updated: December 12, 2025

About the Author

When money gets tight, everything starts to feel like it’s happening at once: collection calls, overdue notices, a mortgage that’s slipping behind, or a car payment you can’t miss. If you have steady income but your bills no longer fit your budget, chapter 13 bankruptcy Arizona can give you a structured way to catch up and move forward while working to protect the things you’ve built.

Chapter 13 is a court-supervised repayment plan under federal bankruptcy law. Instead of wiping the slate clean right away, chapter 13 Arizona typically reorganizes your debts into one plan payment you make each month (often paid to a chapter 13 trustee). Most plans run three to five years. Once you file, an automatic stay generally stops most collection actions while the case is pending—though some obligations (like child support) still continue.

Because the rules and paperwork matter, many people choose to talk with an Arizona chapter 13 bankruptcy attorney (or a chapter 13 bankruptcy lawyer Arizona) to review income, debts, and goals—like stopping foreclosure, catching up on missed payments, or creating a realistic plan you can actually complete.

What Is Chapter 13 Bankruptcy?

Chapter 13 is a type of bankruptcy that lets people with regular income reorganize debt through a court-approved repayment plan. In plain terms: instead of trying to juggle five different creditors and past-due notices, you propose one structured plan that tells the court (and your creditors) how you’ll handle your debts over time—usually while working to keep important property like a home or car.

The plan focuses on priority and practicality. Certain debts generally have to be paid in full (for example, many domestic support obligations). Secured debts (like a mortgage or car loan) are handled based on the specific facts—often by keeping ongoing payments current while using the plan to catch up on missed payments. Unsecured debts (like credit cards and medical bills) may be paid in part, and if you successfully complete the plan, some remaining eligible balances can be discharged.

Your monthly plan payment is typically based on what you can realistically afford after reasonable living expenses—sometimes described as “disposable income.” This is one reason it can be helpful to speak with an Arizona chapter 13 bankruptcy attorney: building a plan is less about “perfect math” and more about creating a payment structure you can actually sustain for three to five years.

When Chapter 13 Is a Good Fit in Arizona

Most people don’t file chapter 13 because they want a “fresh start” in the abstract. They file because something very specific is happening—foreclosure notices, a car that’s at risk of repossession, wage garnishment pressure, or debt payments that have become impossible to juggle. Chapter 13 creates a structured plan so you can stabilize the situation and catch up over time.

• •You’re behind on your mortgage and want to keep your home: Chapter 13 can often pause foreclosure and give you time to catch up on missed payments through the plan, while you keep paying the regular monthly mortgage payment going forward.
• •You need to protect your vehicle and keep reliable transportation: If a repossession is looming or you’re behind on payments, a plan may help create a path to keep the car—depending on the loan, your budget, and your overall case.
• •High-interest debt is crowding out your monthly budget: Credit cards, medical bills, and collections can feel endless when each creditor is demanding a separate payment. Chapter 13 can consolidate the pressure into one structured plan payment.
• •You’re worried about a co-signer: In some consumer-debt situations, chapter 13 can provide protections that reduce collection pressure against a co-signer while the case is active.
• •You want a court-backed “pause button” while you reorganize: Once a case is filed, the automatic stay generally stops most collection actions, which can give you breathing room to make decisions with a clear head.

Who Qualifies for Chapter 13 Bankruptcy in Arizona?

Most people qualify (or don’t qualify) for chapter 13 bankruptcy Arizona based on two big things: steady income and debt limits. Chapter 13 is meant for individuals who can afford a realistic monthly plan payment, even if things are tight right now.

Debt limits: For cases filed between April 1, 2025 and March 31, 2028, the chapter 13 eligibility caps are $526,700 in unsecured debt and $1,580,125 in secured debt (these amounts adjust periodically and are published as official updates).

Credit counseling: Before filing, you generally must complete a pre-filing credit counseling course from an approved provider within the required time window (commonly within 180 days before you file), or the case can be dismissed. Approved agencies are listed by the U.S. Trustee Program, and the Arizona bankruptcy court also publishes warnings and limited-exception guidance.

How Chapter 13 Works in Arizona

Chapter 13 usually follows a predictable timeline. The exact details depend on your income, your debts, and what you’re trying to protect (like a home or vehicle), but most cases move through the same core steps.

1. 1.File the case: You file the petition and financial schedules that list your income, expenses, debts, and assets. This paperwork sets the foundation for everything that follows.
2. 2.The automatic stay starts: Most collection activity must stop once the case is filed (calls, lawsuits, garnishments, foreclosure actions). Some obligations can continue under the law, so it’s important to understand what the stay does—and doesn’t—cover in your situation.
3. 3.Propose your repayment plan: The plan explains how you’ll handle priority debts, secured debts (like a mortgage or car loan), and unsecured debts over three to five years. The goal is a plan payment you can realistically maintain.
4. 4.Start plan payments: In many cases, plan payments begin soon after filing (often before the plan is formally approved). This is one reason budgeting and timing matter early.
5. 5.Attend the meeting of creditors: You answer questions under oath, usually with your attorney present. It’s typically straightforward: the trustee confirms identity, reviews the paperwork, and may ask for clarifications or documents.
6. 6.Plan confirmation: The court reviews whether the plan meets legal requirements and whether it’s feasible. If the trustee or a creditor raises an issue, the plan can often be adjusted.
7. 7.Stay compliant during the plan: You make payments on time, stay current on ongoing obligations (like current mortgage payments, insurance, and support obligations), and report major changes (job changes, big medical issues, significant new income).
8. 8.Complete the plan and receive a discharge: After you finish the plan requirements, eligible remaining unsecured balances can be discharged, and you move forward with a cleaner financial slate.

What a Chapter 13 Attorney Does in Arizona

Chapter 13 is paperwork-heavy and deadline-driven, but the bigger challenge is building a plan that the court will confirm and that you can actually live with for three to five years. A strong Arizona chapter 13 bankruptcy attorney helps you turn your goals (keep the house, keep the car, stop garnishment, catch up on taxes, etc.) into a realistic plan that follows the rules and reduces surprises.

• •Design a workable repayment plan: not just “what looks good on paper,” but a payment that fits your real monthly budget and meets legal requirements.
• •Prepare accurate filings: income, expenses, debts, assets, and required disclosures—so the trustee can evaluate your case without avoidable delays.
• •Handle trustee and creditor issues: respond to document requests, address objections, and make plan adjustments when needed to get to confirmation.
• •Protect what matters most: identify exemptions, flag risks early, and explain tradeoffs so you don’t accidentally choose a plan that creates new problems.
• •Guide you during the plan: job changes, tax refunds, major expenses, or new debts can affect a case. Having counsel can make those moments far less stressful.

If you’re comparing lawyers, ask how often they handle chapter 13 cases, how they communicate during the plan, and what you should expect month-to-month once the case is confirmed.

Arizona Exemptions in Chapter 13

Bankruptcy exemptions still matter in chapter 13 bankruptcy, but they work differently than they do in chapter 7. In chapter 7, exemptions often determine what property you can protect from liquidation. In chapter 13, you typically keep your property, and exemptions more often affect how much your unsecured creditors must be paid through the plan (because the court looks at what creditors would likely receive in a hypothetical chapter 7 case).

If you want the detailed, up-to-date breakdown of Arizona exemptions (including the homestead exemption, vehicle exemption, and personal property protections), our go-to resource is here: Arizona bankruptcy exemptions guide.

How Debts Are Treated in Chapter 13

In chapter 13, the most important question usually isn’t “what gets erased right away?” It’s how your debts are handled over the next three to five years. Your plan typically groups debts into categories, and the rules for each category are different.

• •Priority debts: certain debts usually must be paid in full in the plan (common examples include domestic support obligations and some taxes).
• •Secured debts: In Arizona chapter 13 cases, secured debts are often handled through the plan in a very practical way. If you’re keeping a vehicle, the plan commonly pays the lender a secured claim that satisfies the vehicle balance on terms the court will approve—often at a lower interest rate. In some situations, the secured portion may be reduced to the vehicle’s value (a “cram down”). Learn how a chapter 13 vehicle cram down works.
• •Mortgage arrears: If you’re behind on your mortgage, the plan typically addresses the past-due amount over time. In Arizona, many chapter 13 plans are “conduit” plans, meaning the ongoing mortgage payment is made through the trustee during the plan rather than paid directly to the lender.
• •General unsecured debts: credit cards, medical bills, and many personal loans are often paid partially through the plan. If you successfully complete the plan, any remaining eligible unsecured balance may be discharged.

If you want a deeper “what gets discharged” breakdown, we cover that in more detail in our chapter 7 bankruptcy Arizona guide. In chapter 13, the key is making sure your plan treats each category correctly.

Life During a Chapter 13 Repayment Plan

Once your chapter 13 plan is confirmed, the main job is simple (even if it isn’t always easy): make the plan payments and stay consistent. A three- to five-year plan is a long runway. Life happens—job changes, unexpected medical expenses, car repairs, or family emergencies. The goal isn’t perfection. The goal is staying proactive so small problems don’t turn into plan-breaking problems.

• •Make payments your #1 priority: treat the plan payment like rent or a mortgage—something you build the rest of your budget around.
• •Call your attorney early if something changes: if your income drops or a major expense hits, don’t wait until you’re already behind. In many cases there are options, but timing matters.
• •Plan modifications can be common when truly needed: if you fall behind for a legitimate reason, a modified plan may help you get caught up. But it shouldn’t become an excuse to spend more or take on new optional expenses.
• •Use the plan years to build better money habits: chapter 13 can be a rare window where you have a clear structure and fewer surprise creditor demands. That’s the perfect time to tighten budgeting, track spending, and build small reserves for emergencies.
• •Stay transparent: keep good records and be ready to report major changes (job changes, significant new income, large expenses, or other events) when required in your case.

Most successful chapter 13 cases aren’t “perfect.” They’re the ones where the filer stays engaged, asks questions early, and treats the plan as a real opportunity to stabilize and rebuild.

Completing Chapter 13 and Moving Forward

For most people, the finish line in chapter 13 is completing the plan requirements and receiving a discharge of eligible remaining debts. That’s often when the pressure finally lifts—because the plan did what it was designed to do: create a structured path back to stability.

Two important real-world notes: (1) some chapter 13 cases are essentially 100% plans, meaning creditors are paid in full through the plan—so the discharge may be less of the “big moment” people expect, because there’s little (or nothing) left to discharge. (2) In rarer situations, a debtor may not be eligible for a chapter 13 discharge due to the timing of a prior bankruptcy discharge (or other specific legal requirements), even if the plan is completed—so it’s worth confirming discharge eligibility early in the case.

After you finish the plan (and once the case is wrapped up), focus on the basics that move your life forward:

• •Save your paperwork: keep your discharge order (if entered) and key case documents somewhere safe.
• •Check your credit reports: review for accuracy over the next few months and dispute clear errors.
• •Keep the habits that got you through the plan: use what you learned—budgeting, spending discipline, and building a small emergency reserve—so a surprise expense doesn’t become a new debt spiral.
• •If something seems off, ask quickly: if you expected a discharge (or a particular creditor treatment) and something doesn’t match, contact your attorney right away so it can be addressed while options are still available.

Choosing the Right Chapter 13 Bankruptcy Lawyer in Arizona

A strong chapter 13 bankruptcy lawyer Arizona should do two things well: (1) explain your options in plain English, and (2) build a plan you can realistically complete. The “right” fit is usually the attorney who is clear, responsive, and honest about what chapter 13 can (and can’t) accomplish in your situation.

• •Experience with chapter 13: ask how many chapter 13 cases they handle each year and what their process looks like from filing through confirmation.
• •Plan budgeting approach: ask how they set a plan payment and what they consider “realistic” for a three- to five-year commitment.
• •Communication during the plan: ask who you contact if your income changes, you miss a payment, or you need guidance mid-plan—and how quickly they respond.
• •Transparent fees: make sure attorney fees, filing fees, and any required courses are explained upfront in plain English—no surprises.
• •Comfort level matters: you should feel comfortable asking “basic” questions. If you feel rushed or talked down to in the consultation, keep looking.

If you’re specifically looking for an Arizona chapter 13 bankruptcy attorney, it’s reasonable to consult more than one lawyer before choosing—chapter 13 is a long process, and the relationship should feel stable from the start.

Frequently Asked Questions About Chapter 13 Bankruptcy in Arizona

How long does a chapter 13 plan last?

Plans are typically three to five years, and the required length often depends on income compared to the applicable median.

Can chapter 13 stop foreclosure in Arizona?

chapter 13 can stop foreclosure proceedings and may allow you to cure delinquent mortgage payments over time, as long as you keep up with the payments that come due during the plan.

Does a garnishment stop during a chapter 13 Arizona?

In many cases, yes. Once a chapter 13 case is filed, the automatic stay generally stops most collection activity, including wage garnishments and bank garnishments. That said, there are exceptions and timing matters—if a garnishment is already in process, you’ll want to notify your attorney immediately so they can take the right steps to enforce the stay and coordinate with the employer or bank if needed. Some obligations (like certain support-related collections) can follow different rules.

Do I need a minimum amount of debt to file?

There’s no minimum debt requirement, but chapter 13 is usually most helpful when you need a court-backed structure to catch up on arrears, manage multiple debts, or protect assets while you repay over time.

Where can I read the official basics?

You can read the federal courts’ overview here: chapter 13 Bankruptcy Basics (U.S. Courts).

Is Chapter 13 Bankruptcy Right for You?

Chapter 13 can be a strong option when you have steady income, you’re trying to protect important property, and you need a realistic plan to catch up and move forward. The most helpful next step is usually a consultation where someone reviews your income, your mortgage or vehicle situation, the types of debts you have, and whether a three-year or five-year plan is more realistic for your budget.

For informational purposes only. This page is not legal advice.