- Robert Weed
Filing bankruptcy in Virginia gets harder November 1
You can thank the bank lobbyists who wrote the 2005 bankruptcy law for this cute trick. When times get tough, filing bankruptcy gets harder and more expensive.
How’s that? Eligibility to file bankruptcy is much harder for people who are over the median (average) income in each state. When times get tough, the average income falls. That makes eligiblity harder.
Check out these numbers, just released today. Right now, a family of two in Virginia making less than $64,890 has automatic income eligibility to file Chapter 7 bankruptcy. November 1, that drops to $62,686. It’s the same for a family of three. Right now a three person family making less than $73,887 has income eligibility. On November 1, that drops to $72,078.
The unfairness to people with big families gets worse. Right now a family of four is allowed to make $37,443 more than a single person with no kids. Starting November 1, that drops to $36,102. The law thinks taking care of kids should get cheaper in a recession.
When I look at that, I get mad all over again at the supposedly pro-family values political party that gave us this law in 2005.
While incomes are falling for average families across Virginia, the banks are doing great. Earlier this week, JP Morgan Chase announced third quarter profits jumped 23%.
Here’s the complete chart, from the Office of the United States Trustee. This chart shows how incomes are falling in Virginia for families of two, three, and four people. Making it harder for people to get their bankruptcies approved.
Family size Now Nov 1
1 $48,190 $49,484
2 $64,890 $62,686
3 $73,887 $72,078
4 $85,633 $85,586