Virginia Bankruptcy
The Code provides numerous options for discharge and reorganization of debts. The benefits and burdens upon
debtors varies, and may provide a significant improvement in financial condition. Because the law evolves daily
through legislative and judicial decisions, the assistance of qualified legal counsel is essential to gain the
maximum benefit allowed by law.
Planning for a Virginia bankruptcy is essential. All types of cases are protected by an
automatic stay after filing a petition. Thereafter, qualification for each chapter is different, as is the
relief available. All issues concerning exemptions, forfeiture of assets, if any, legality of past conveyances,
and qualification are properly consider before selecting a particular chapter. The options currently available
to individuals domiciled within the state are:
Virginia bankruptcy under Chapter 7 remains the most popular chapter today for
individual debtors because it eliminates debts quickly and does not require full or partial payments. With
reform looming on the horizon since 1994, new restrictions are expected at any time which will eliminate chapter
7 options for all individuals who receive a salary equal to or above the state median income level.
Virginia bankruptcy under Chapter 11 is the preferred choice for large
corporations and wealthy individuals. In exchange for an expensive administration, more lucrative options and
benefits are available. Ch. 11 filings decreased nationwide since 2001, while all other chapter filings
increased steadily both in number and as a percentage of the general population.
Virginia bankruptcy under Chapter 12 applies only to family farmers.
Because of the seasonal nature of crops, special provisions allow reorganization payments to be tailored to
harvests.
Virginia bankruptcy under Chapter 13 availability requires regular monthly
income. Subject to ceilings placed on total debt, employees and others who earn regular income may reorganize
payments, terms, and interest rates, as well as discharge the remaining portion of debts upon completion of
a plan.
Restrictions on Virginia Bankruptcy Lawyers
Special restrictions apply to Virginia bankruptcy lawyers according to the rules of procedure adopted by Virginia
bankruptcy courts. Attorney fees and filing fees are also subject to regulation. For more information, see:
Reform of the availability of federal debt relief is now under consideration by the U.S. Congress. A
new "abuse prevention act" is expected to pass into law at any time. Included within proposed regulations, Ch. 7
will not be available to many individuals, Ch. 13 payments will increase, judges will lose discretion on
individual cases, and mandatory new penalties and fines will be imposed in new circumstances, and become
mandatory upon the motion of any creditor. New laws
under consideration were proposed primarily by lobbies representing commercial lenders.
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