Court Order Eliminates “Zero Down” Bankruptcy Fee Agreements in Arizona: What This Means for You
If you’ve been considering bankruptcy as a way to reset your financial future, you may have come across law firms offering “$0 down” Chapter 7 filings or flexible low-down payment options. These types of agreements were common in Arizona, but due to a recent court decision, they are no longer available.
Update January 15th, 2026:
Notice to all Hilltop Law Firm clients: In accordance with an order signed on January 13th, 2026 by the Honorable Edward P. Ballinger, Jr., Chief Judge of the United States Bankruptcy Court District of Arizona, General Order 25-2 has been delayed. According to the judge, Order 25-2 “shall govern proceedings commenced thirty (30) days after a date that is yet to be determined.”
At this point it is uncertain how this situation will ultimately be resolved. If you have any questions about how recent court rulings will affect the fee structure for filing Chapter 7 bankruptcy, please don’t hesitate to call our office, and we will be happy to keep you informed about how the situation is unfolding. You can reach us at (602) 466-9631.
Thank you to all our clients for your ongoing patronage and the trust you have placed in Hilltop Law Firm.
The United States Bankruptcy Court for the District of Arizona has issued a new rule: General Order 25-2. This order significantly changes how bankruptcy attorneys can structure fees. The order impacts anyone looking to file for Chapter 7 bankruptcy in Arizona, and it effectively bans traditional “$0 down” or bifurcated fee agreements unless strict requirements are met.
Cy Hainey is an experienced Phoenix bankruptcy lawyer. At Hilltop Law Firm, we help clients in Phoenix and across Arizona make informed financial decisions that align with your goals. This article breaks down what the new court order means for people who are thinking about filing for bankruptcy, and how we can help.
What Did the Court’s General Order Change?
Before this order, attorneys frequently split up the Chapter 7 bankruptcy process and the payment structure into two parts:
- A pre-petition agreement
- A post-petition agreement
This arrangement is also known as a bifurcated agreement.
Under this arrangement, clients filing for bankruptcy could:
- Pay $0 or a low amount up front, like $500
- Get basic filing assistance for the initial bankruptcy petition
- Pay the remaining balance over 12 months after filing, covering the bulk of the legal work like preparing additional schedules, creditor statements, and attending the 341 meeting of creditors
This was a convenient way to get immediate relief from wage garnishment and harassing creditors. But now the Court is requiring that attorneys complete nearly all legal services on the front end, which means attorneys can no longer legally justify providing full bankruptcy representation with little or no payment up front. In essence, General Order 25-2 is pushing attorneys to collect their full fees before filing a bankruptcy claim.
Why Did the Court Make This Change?
According to the order, Arizona bankruptcy judges observed inconsistent practices among attorneys offering $0 down bankruptcies. The Court expressed concern about:
- A lack of uniformity in services
- Insufficient disclosure of payment terms
- Inadequate representation for debtors
- Poor enforcement of responsibilities outlined in fee agreements
To ensure that all Phoenix Chapter 7 filers receive thorough and ethical representation, the Court imposed new rules to define exactly what services must be performed before a case can be filed.
What Services Must Be Completed Up Front?
The new requirements outline 22 Minimum Required Services that must be performed. These include:
- Reviewing financial documents
- Pre-filing counseling
- Preparing all petition schedules and statements
- Filing motions, attending hearings, and representing you at the 341 meeting
- Responding to certain creditor motions and objections
- Filing reaffirmation agreements, lien avoidance motions, and more
The big change is that services can no longer be split up in a way that leaves most of the work for after filing, unless the post-petition agreement is signed after filing and meets strict disclosure and reasonableness standards. This creates an unfortunate financial and logistical barrier for clients who are struggling with their finances.
Hilltop Law Firm Continues to Offer Affordable Bankruptcy Options
Hilltop Law Firm remains committed to helping their Phoenix bankruptcy clients get out from under debt, even with these new constraints in place. While we can no longer offer a $0 down option under this new rule, we’re adjusting our process in a way that continues to prioritize your access to legal protection. Chapter 7 Bankruptcy is still an available option, but timing and planning will now play a bigger role.
Depending on your situation, we may be able to:
- Create an affordable payment plan so you can save toward your full fee
- Begin working on your case once payments are complete
- Advise you on interim protections while you wait to file
Hilltop Law Firm Works to Provide Affordable Plans
Because the court has made bifurcated agreements financially and logistically impractical, Hilltop Law Firm and most other bankruptcy attorneys are moving away from them altogether.
Cy Hainey at Hilltop Law Firm understands the financial burden faced by people who seeking debt relief by filing for Chapter 7. Here’s how we’re helping our clients adjust to the new rules:
- Transparent Pricing: We’ll walk you through the total cost of your Chapter 7 bankruptcy and explain exactly what’s included. No surprises.
- Flexible Pre-Filing Plans: While we can’t file with $0 down, we can structure a pre-filing payment plan that allows you to pay in installments before the petition is submitted.
- Timely Guidance: We’ll help you develop a timeline and budget so you know exactly when your case can be filed and what steps you need to take.
- Clear Communication: You’ll receive a copy of General Order 25-2 within 24 hours of signing a fee agreement, as required, and we’ll walk you through what it means for your case.
Want to Learn More About Your Debt Relief Options?
If you you’re looking for the most economical way to file for bankruptcy, here’s what you can do now:
- Schedule a free consultation with our firm. We’ll review your finances, debts, and eligibility to determine if Chapter 7 is right for you.
- Discuss payment options. Based on your situation, we can set up a custom pre-filing payment plan.
- Avoid making financial decisions without legal advice. Don’t transfer property, take out new loans, or make large payments to creditors before speaking with us, it could jeopardize your case.
Speak With Our Trusted Bankruptcy Attorney in Phoenix
At Hilltop Law Firm, we’re here to provide experienced guidance for people who are feeling overwhelmed by debt. If you need help filing for bankruptcy in Arizona, call (602) 466-9631 for a free consultation.
We’ll help you understand your options and find the most affordable path forward. Your fresh start is still within reach, and we’re here to help you get there.