Virginia Chapter 7 Bankruptcy
The Bankruptcy Law Office of Robert Weed led all attorneys in Virginia Chapter 7 bankruptcy case filings in 2013.
We did more Chapter 7 bankruptcies last year than any other Virginia lawyers.
That fact was announced just recently by 722 Redemption Funding, a company that finances cars for people in or just out of chapter 7 bankruptcy. You can see their full report here.
For most people who are in financial trouble in Northern Virginia Chapter 7 bankruptcy brings immediate relief from financial pressure, and the chance to build back to good credit in three years.
Compared to Chapter 13, Chapter 7 for most people offers more immediate relief and quicker return to good credit. (Happiness, too–a survey we sponsored with SurveyMonkey showed 93% of our clients said life was better after bankruptcy. You can read that here.)
The simple reason Chapter 7 is better than chapter 13, is Chapter 7 is over. Chapter 13 runs on, usually for five years.
The 2005 bankruptcy reform law tried to push high income people into Chapter 13. Northern Virginia is a high income–and high cost-of–living area. Since Chapter 13 is much worse for your credit than Chapter 7–and much more likely to fail–I push back.
Usually if high income people are talking to a bankruptcy lawyer, there’s a reason why there’s a financial problem. I try to find that reason–and use it to qualify people for Chapter 7 (if Chapter 7 is better for them).
Virginia Chapter 7 Bankruptcy Automatic Income Eligibility
The median income figures for Virginia were just updated as of April 1, 2014. Families that are below the median income automatically have income eligibility to file Virginia Chapter 7 bankruptcy.
Families with more income, do not have automatic eligibility. They need to prove why they should be eligible. That means carefully analyzing their budget under the bankruptcy means test. I explain more about that here.
Here are the cutoff numbers, by family size.
One Two Three FourVIRGINIA$52,576$66,470$76,884$92,277
Families with income over these numbers can still have income eligibility for Chapter 7. But they have to work to prove it. An experienced Virginia Chapter 7 bankruptcy lawyer can help.
(I should say here that for some people even with income eligibility for Chapter 7, Chapter 13 is better. Chapter 13, for example, is better that Chapter 7 in dealing with student loans, or with unfiled taxes, and sometimes with divorce problems. For most people who don’t have those problems, Chapter 7 is better.)