Residents of Virginia may file for a Virginia bankruptcy under Chapter 7 or 13 depending on whether or not they want to keep their home, car and other personal assets. If you cannot afford an attorney, you can file “Pro Se”, and represent yourself. If you file Pro Se, there is no legal help available for you. However, you can obtain a copy of the local bankruptcy rules from the court to help you follow the right procedures. You are responsible for filing the appropriate paperwork including a petition listing the name and address of each of your creditors, submitting a verified statement with your social security number and requesting allowable asset exemptions. You will also need to file a statement of compliance of credit counseling, and give your creditors notice, as well as publish the notice in a newspaper of general circulation in the county where you reside. There are other documents such as extensions, notices of hearings and creditor’s meetings that you need to be familiar with as well.
Since most people are not knowledgeable and experienced about Virginia bankruptcy laws, they are taking a risk not hiring a bankruptcy attorney to represent them. You may lose exemptions of your assets because you did not understand the bankruptcy laws, or you failed to follow the laws. Filing services only file paperwork with the court; they cannot legally representing you. Only an attorney can represent you, and give you advice. You should consult with a bankruptcy attorney before you file for bankruptcy.
Virginia Bankruptcy Exemptions
The following is a list of possible assets that are exempt under Virginia bankruptcy laws:
- Property held in tenancy-if debt of only one spouse
- $5,000 plus $500 for each of your dependents-couples can double the amount
- Exemptions for a mobile home, rental income, profits, and sales proceeds up to $5,000
- Benefits for burial
- Society and fraternal benefits
- Life insurance benefits
- Sick benefits
- Partnership business Property
- Pensions and IRA accounts
- Worker’s compensation
- Unemployment
- Disability
- Blind and disabled and elderly aid
- AFDC
- Minimum of 75% of unpaid wages
Chapter 7 Bankruptcy
If you qualify for Chapter 7, the trustee will sell your assets, other than exempt assets, to pay off your creditors. Chapter 7 allows you to get rid of all your debts, except statutory debts such as:
- Spousal and child support
- Income taxes (federal taxes that are at least three years old may be discharged in bankruptcy)
- Student loans
- Secured debt (except mortgages)
With a Chapter 7, you get a fresh start.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy allows you to enter into a court-approved payment plan with your creditors so you can keep your house, car and credit cards. Most plans are for 3-5 years to allow enough time for you to pay your debts. If you default on your mortgage payment, your lender could foreclose.
Bankruptcy Stops Foreclosure
If you are in foreclosure, filing for bankruptcy stops the foreclosure proceedings. The lender could petition the court to have the stay removed, and sell your home at foreclosure sale so you should consult with your attorney to find out how to protect your home. Generally, people who are in foreclosure only file for bankruptcy protection as a last resort if they cannot work out a solution with their lender to keep their home and are overwhelmed in other debts besides mortgage debt.
Consult with an Attorney
It is recommended that you consult with a Virginia bankruptcy attorney to find out what your legal rights and obligations are when you file for bankruptcy. A bankruptcy attorney is knowledgeable about the Virginia bankruptcy laws, and can explain them to you.
