Start New: Stay Creditors, Personal Chapter 7 Bankruptcy & Chapter 13 Bankruptcy

Virginia Beach Bankruptcy Attorney

If you need to go bankrupt, Virginia Beach Attorney Daniel Rodgers, PLC, can help you with your Chapter 7 or Chapter 13 personal bankruptcy. He can also refer you to skilled business bankruptcy attorneys who focus their entire practice in this area if you need a business bankruptcy, at no additional charge.

While bankruptcy can be a difficult time, from polls, the majority of entrepreneurs have had to at least consider this at one time or another. And while no one prefers to see an attorney about a chapter 7 or chapter 13 bankruptcy, it can be a way to preserve some of your assets, and begin anew.

With the lay offs in the job market, and foreclosures looming, many people who never would have thought that they would be considering bankruptcy are considering it for the first time.

Bankruptcy is not well understood, and if you are considering it, you probably don’t have a good sense of what it involves, or what you should bring to an appointment. So let’s review some basic information about both.

Just what is Chapter 7 and Chapter 13 bankruptcy?
Chapter 7 bankruptcy is where your debts are washed away (“discharged in bankruptcy”), but some of your property may have to be liquidated, depending on how much you have. In fact, if you have a lot of assets, Chapter 7 bankruptcy is probably not available to you, nor would you want it to be. In a Chapter 13 bankruptcy, you get to keep more of your property, but you have to repay more of your debts over time.

A Chapter 7 bankruptcy takes a single trip to court, though it takes several months to process. You must complete a credit counseling course.

When you come to discuss a Chapter 7 bankruptcy or a Chapter 13 bankruptcy with Virginia Beach Attorney Daniel Rodgers, please bring all your bills (it is imperative that you bring all your bills if you want them all to be discharged in bankruptcy). Also bring a list of these bills with a description, and any judgments or liens placed against you or your property. This lets there be the clearest of communication on the bills in the minimum of time, and this tends to save money at a time when you most want to.

It will also be important to have a list of the property that you have. For example, the Court will want to know what property you have given away or sold over the last two years, what tools of your trade you need to keep, and about all other property (even including clothing, or social security payments, to give you a sense of the depth of detail the Court is looking for).

The immediate effect of filing for bankruptcy is that it creates an “automatic stay.” In other words, all other proceedings against you by your creditors are paused while the U.S. Bankruptcy Court sorts things out. You are placing your property and bills under the control of the Court, and the Court puts a Trustee in charge. The Trustee’s job is to sell any assets over the amount that you are allowed to keep, and make sure that your creditors get the money.

After your exemptions are totaled and counted against your property, and your remaining assets liquidated to pay creditors, the Court wipes away your debts.

There are some debts that survive bankruptcy. Student loans, taxes, and child support, for example, unless the Court deems that it would be an out of the ordinary hardship.

In deciding whether you should have a Chapter 7 bankruptcy, it is worth considering its effect on your credit, whether you are eligible, whether would be able to keep your car, or your house, or enough of the property you and your family need, and whether there are less restrictive alternatives. For example, negotiating to pay a lesser amount to creditors, or getting a second job.

Chapter 13 bankruptcy, or re-organization bankruptcy, is different than Chapter 7’s liquidation oriented bankruptcy. In a Chapter 13 bankruptcy, we file a plan with the Court providing for the repayment of some debts in full, some debts partially, and in some cases some debts not at all. This repayment with your extra income takes place over time -- over a five or three year period -- depending on whether your income for the six months prior to filing has been higher or lower than the state median income.

To be eligible for Chapter 13 bankruptcy, we have to show the Court that you can repay your debts. Your income cannot be too low relative to the debts, and there must be some regularity to your pay.

There are priority debt repayments under a Chapter 13 bankruptcy. For example, payments to employees, child support, payments of back amounts owed on loans on major items such as your car or house, for example. And then there are other payments that are made using your discretionary income remaining.

Please note that this discussion of bankruptcy is an overview, discussing general ideas and concepts. To determine how these apply to your case, and what other important details may affect you, please consult the professional of your choice.

If you need help, call Virginia Beach Attorney Daniel Rodgers at 831-1551.