Arizona's homestead exemption protects $250,000 of equity in your home. Combined with Chapter 13's mortgage cure provisions, most Phoenix homeowners can keep their homes through bankruptcy.
Arizona provides a homestead exemption of $250,000 under A.R.S. section 33-1101 (increased from $150,000 in 2022). This protects equity in your primary residence from creditors and the bankruptcy trustee.
How equity works: If your home is worth $300,000 and you owe $250,000, your equity is $50,000. If your equity is within the $250,000 exemption, it is fully protected.
Arizona is a non-judicial foreclosure state using a deed of trust system. The trustee records a notice of sale at least 90 days before the sale date and mails notice to the borrower. The sale occurs at public auction. Arizona has no statutory right of redemption after a trustee sale (only after judicial foreclosure). However, Arizona's anti-deficiency statute (A.R.S. section 33-814(G)) prevents lenders from pursuing a deficiency judgment after a trustee sale on purchase-money loans for properties on 2.5 acres or less.
Chapter 13 is the most powerful tool for Phoenix homeowners facing foreclosure:
Maricopa County processes more trustee sales than almost any county in the Southwest. Phoenix's rapid population growth and housing price volatility mean many homeowners find themselves underwater. Arizona's anti-deficiency statute is a significant protection: after a trustee sale on a purchase-money deed of trust for property on 2.5 acres or less, the lender cannot pursue you for the shortfall.
In most cases, yes. Arizona's homestead exemption protects $250,000 of equity. In Chapter 13, you can keep your home and cure mortgage arrears over 3-5 years.
Arizona protects $250,000 under A.R.S. section 33-1101 (increased from $150,000 in 2022).
Arizona uses non-judicial (trustee sale) foreclosure. The typical timeline is approximately 90 days from the recording of the notice of trustee sale.
Yes. Filing Chapter 13 immediately stops foreclosure through the automatic stay. You can cure your mortgage arrears over 3-5 years while resuming regular payments.
In Chapter 7, you must be current on your mortgage to keep your home. Chapter 7 can eliminate other debts, freeing up income to make mortgage payments.
In Chapter 13, if your home is worth less than your first mortgage, you may strip off your second mortgage entirely under 11 U.S.C. section 1322(b)(2). This can save tens of thousands of dollars.
Use the free 1328(f) screener to check whether a prior discharge affects your eligibility for a new bankruptcy discharge.
Free Discharge Screener Means Test Guide