Virginia Bankruptcy Debtor's Guide

On August 18, 2003, the Administrative Office of the U.S. Courts issued a press release declaring "Bankruptcy cases continue to break federal court caseload records - total bankruptcy filings and non-business filings hit highs." The lowest rate of increase in the filing rate for Virginia bankruptcy cases during 2003 occurred in the Eastern District ( Alexandria, Newport News, Norfolk and Richmond Divisions). The Western District (Roanoke, Lynchburg, and Harrisonburg Divisions) was also low compared to the national growth rate +9.6%. Chapter 7 and Chapter 13 cases filed by individuals accounted for 97.78% of all Virginia bankruptcy filings in 2003.

Current Virginia bankruptcy laws allow for the full & final discharge of debts in Chapter 7. Chapter 13 combines past due amounts into one monthly payment, at reduced interest, for up to five years. Additionally, partial payments are available which discharge remaining balances at the end of the plan term. The maximum payment in Chapter 13 is determined based on net income after paying living expenses. In ether chapter, all Virginia bankruptcy cases are subject to court review. Also be aware that Virginia bankruptcy courts may set a hearing if an objection is filed by a trustee, creditor, party in interest, or upon their motion. After all objections are resolved to the satisfaction of the court, discharge of debts or confirmation of the plan is mandatory. Conversely, if objections are not resolved, cases are usually dismissed. Most often, the success of each case is determined by careful planning before selecting chapter, options and filing date.

Virginia Bankruptcy Questions

New bankruptcy laws are expected to limit the value of the homestead exemptions. Also, new Ch. 7 restrictions will prevent anyone earning over the state median income from filing, Ch. 13 payments will be increased, and judges will lose judicial discretion imposing mandatory sanctions upon debtors in many new circumstances. These new laws narrowly missed passage each year since 2001, and may become effective at any time. Now, more than ever, timing and planning are critical.

Most Virginia bankruptcy attorneys who special in consumer/debtor cases offer free initial consultations. Virtually all private attorneys welcome opportunities to meet qualified potential clients. After debtors become familiar with current requirements, initial consultations offer an excellent opportunity to explore options and receive free legal advice, before deciding upon any course of action. If you have considered filing, make a detailed list of questions. Meet with several lawyers. By comparing costs, benefits and options without obligation, your most profitable path will become clear.