When you think of the Commonwealth of Virginia, what comes to mind? Is it Civil War Battlefields, historic sites and the Appalachian Trail? Or are you so blinded by the amount of your credit card debt and medical bills that you can’t see the beauty of Great Falls Park?
If this is the case, then a Chapter 7 bankruptcy is just the thing that you need in order to relax and not worry about being harassed by creditors, haunted by garnishments and buried by a towering stack of debt. A bankruptcy, Chapter 7, also known as a straight, or liquid bankruptcy, will clear up most of your debts, leaving you able to live with less anxiety on a daily basis.
A Chapter 7 bankruptcy erases debts like credit card bills, tax liens, medical bills and other miscellaneous charges. But, you’ll still be responsible for the following debts:
- Student loans
- Recently filed tax debts and liens
- Alimony and child support
- Money owed through certain court judgments related to illegal activities
Is Your Credit History as Complex as the History of Virginia?
If so, then a Chapter 7 bankruptcy may be just the thing that you need to get back on track and make life less stressful. Find a Virginia bankruptcy attorney and your worries will vanish. A Chapter 7 bankruptcy attorney is one who understands the details of bankruptcy laws that are specific to Virginia. When you first meet with one, you’ll need to bring the following information in order to determine your eligibility:
- A list of all of your possessions, including electronics, furniture and jewelry
- A list of your debts. Whether they qualify for dismissal or not, you’ll need a list of all creditors. In some cases, you may also need past statements and other information.
- Last year’s filed tax return (and your spouse’s return, as well)
- Your last six month’s worth of paystubs and bank statements
- Titles and deeds to your vehicles, house and any other property (if applicable)
Qualifying for Chapter 7 Bankruptcy in Virginia
The next step that you and your attorney will undertake will determine whether or not your income qualifies you for a Chapter 7 bankruptcy. The income limits for residents of Virginia are as follows:
Family Size:
- 1 person – $50,296
- 2 people – $63,613
- 3 people – $73,260
- 4 people – $86,990
- More than 4 people: Debtors must add $7,500 per family member to the income level for family’s over 4 members.
If you make too much money to qualify outright, your attorney will perform a means test. This test is a mathematical process, created by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, carefully weighs your income, all of your assets and the amount of your debts to see if you still qualify for a bankruptcy, Chapter 7. If you don’t qualify, even after the means test is performed, you may still be able to file for a Chapter 13 bankruptcy. Your local attorney will help you determine if a Chapter 13 bankruptcy is the right option for you. The income levels posted above may change to reflect economic conditions.
The Process isn’t Scary with a Chapter 7 Bankruptcy Attorney by Your Side
Although going through bankruptcy may sound like a daunting and complicated process, it is really rather simple. Your attorney, after determining your eligibility, will help you fill out your bankruptcy petition. Then, before your Chapter 7 petition is filed, you will need to take a credit counseling course over the Internet or by phone (the course is short – approximately 90 minutes long). You will be required to take another short course after you file.
After you take the first one, your petition is filed with your local bankruptcy court. A trustee is then appointed to represent your creditors, and then, a judge will approve your petition and declare you to be officially bankrupt. While occasional questions arise about a certain debt or other financial matter, most cases are resolved in about 6 months. Once you receive your discharge you’ll be able to sleep peacefully again, since you creditors will no longer be able to contact you. If they have any questions, they’ll either have to contact your attorney or the trustee.
What About Your Home and Income?
You can rest assured that many of your assets will stay intact during and after your bankruptcy. The Bankruptcy Reform Act ensures those filing Chapter 7 bankruptcy that they can keep enough assets to start over with. Some states even allow debtors to choose between state and federal exemption laws. However, for Virginia residents, debtors only have the option for state exemptions.
See the below list for examples of assets debtors can keep:
- House exemption: Up to $5,000 in value is exempt for a home (debtors over the age of 65 may claim $10,000)
- Other personal property: $2,000
- Household property:
- Family bible: 100%
- Wedding rings: 100%
- Burial or cemetery plots: 100%
- Clothing: $1,000
- Furniture: $5,000
- Pets: 100%
- Tools used for trade or business: $10,000
- Vehicle: $2,000
- Farming Equipment:
- 1 pair of horses
- 1 wagon
- 2 plows
- 1 tractor: $3,000
- Fertilizer: $1,000
- Benefits and insurance – 100% of all of the following:
- Industrial sick benefit insurance benefits
- Group life insurance policies & proceeds
- Life benefit company benefits
- Burial society benefits
- Fraternal Benefit Society benefits
- Unemployment Compensation benefits
- Public assistance payments
- Miscellaneous benefits – 100% of the following:
- Decedent's family allowance
- Crop insurance proceeds
- Awards to crime victims
- Growing crops
- Payments made under prepaid tuition contract
More exemptions are available depending on your bankruptcy petition and financial need. An experienced bankruptcy attorney can help you find out what exemptions will help your situation.
Talk to a local Virginian bankruptcy attorney today. He or she can help you out of your debt predicament.
Virginia Bankruptcy Courts
Martin V.B. Bostetter, Jr.
United States Courthouse
200 South Washinton Street
Alexandria, Virginia 22314-5405
Phone: (703) 258-1200
United States Courthouse
116 North Main Street, Room 223
Harrisburg, Virginia 22802
Phone: (540) 434-8327
United States Courthouse
1101 Court Street, Room 226
Lynchburg, Virginia 24504-4503
Phone: (434) 845-0317
United States Courthouse
2400 West Avenue, Room 110
Newport News, Virginia 23607
Phone: (757) 222-7500
Walter E. Hoffman United States Courthouse
600 Granby Street, Suite 430
Norfolk, Virginia 23510-191
Phone: (757) 222-7500
Spottswood W. Robinson III & Robert R. Merhige,Jr.
U.S. Courthouse
701 East Broad Street, Suite 4000
Richmond, Virginia 23219
Phone: (804) 916-2400
Commonwealth of Virginia Building
210 Church Street, Room 200
Roanoke, Virginia 24011-1517
Phone: (540) 857-2391