Charlottesville Chapter 7 and Chapter 13 Bankruptcy Attorney | TGB Law
Facing a Judgment, Garnishment or Foreclosure? Bankruptcy may be the answer. Call the Bankruptcy Attorneys at TGB Law today for a FREE one-hour office consultation.
Why use Tucker Griffin Barnes for your personal bankruptcy:
We believe that no matter the situation that has brought you to our office, we want to be the bankruptcy firm that meets your needs. Our bankruptcy attorney, Shannon T. Morgan, starts by listening to what you have to say and is prepared to competently advise you on your bankruptcy issues. She recognizse that in today’s economy there are a lot of people suffering from financial hardships (many of which are outside of their control). Wanting to help people get back on track financially, she realizes that the road to financial stability may often require a person to file for bankruptcy. Shannon is uniquely committed to empathetically assist those who need some assistance addressing their finances, whether it’s a Chapter 7 or Chapter 13 bankruptcy.
What is a Chapter 7 Bankruptcy?
A Chapter 7 Bankruptcy is a complete or a liquidation bankruptcy. It is often the tool an individual may use to quickly escape the burden of excessive debt and receive a fresh financial start. The bottom line with a Chapter 7 Bankruptcy is that it is a way to discharge (or have the federal government wipe out) certain debts, including but not limited to medical debt, credit card debt, and personal loans. The term “liquidation bankruptcy” can be a bit scary as it often leads people to believe that they will lose necessary assets like a home or a car by filing for a Chapter 7 Bankruptcy.
The liquidation aspect of a Chapter 7 Bankruptcy means the trustee assigned by the Court to oversee a person’s bankruptcy estate may sell assets that are not otherwise protected under allowed exemptions. There are certain situations where people filing for bankruptcy do wish to surrender a car, home, or some other secured asset in order to be rid of the debt that is associated with the asset and, provided you qualify for a Chapter 7 Bankruptcy, this may be the best option for you if you are behind in your payments and/or are so upside down in your equity that you will not recover in a reasonable amount of time.
However, if one is current on their secured debt (the debt secured by some collateral like a home or a car), does not wish to surrender the asset, has a limited amount of equity in the asset, and has the income to continue to pay the secured debt, the person’s assets may be kept even after the Chapter 7 Bankruptcy provided the person continues to pay on the debt and (in most cases) signs an agreement to make the debt survive the bankruptcy.
There are certain debts that are not dischargeable in a Chapter 7 Bankruptcy (including, but not limited to, child support, most tax obligations, most student loans, or any debt incurred as a result of fraud) and you will need to discuss your unique situation with an experienced attorney to assess if a Chapter 7 Bankruptcy is available for you or if it is your best option.
What is a Chapter 13 Bankruptcy?
A Chapter 13 Bankruptcy allows a Debtor to enter into a Repayment Plan that will address the Debtor’s debts over the course of a thirty-six to sixty month (3 to 5 year) repayment period. The Debtor’s payments are made to the Chapter 13 Trustee (an individual assigned by the Court to manage the Debtor’s payments to creditors under the Repayment Plan) throughout the case and, once the Court has approved the Repayment Plan, the Trustee disperses payments in accordance with the Repayment Plan to all of the creditors.
A Chapter 13 Bankruptcy is an extremely powerful financial tool for an individual who: has fallen behind on secured payments (i.e. those for a car or a home); is facing foreclosure or repossession and wants to keep the asset the creditor is seeking; is significantly upside down on debt owed for a car purchased several years ago; owes tax debt that the person cannot pay off within one year of incurring it; is paying high interest on a secured obligation that can be paid off within the life of the Repayment Plan; has a second mortgage on his or her home where more is owed on the first mortgage than the house is worth; or does not qualify for a Chapter 7 Bankruptcy for certain reasons.
The portion of debt that is repaid through a Debtor’s repayment plan is determined based upon several factors including that person’s income (and their spouse’s income if he or she has a spouse and they are living together) compared to allowable expenses and any equity the person has in unprotected assets. As a Chapter 13 Repayment Plan significantly affects the rights of the Debtor’s creditors, the Court will ultimately need to enter an order confirming the Repayment Plan for it to be effective against the creditors.
Once the Debtor has made all of his or her payments, any dischargeable debt remaining due at the end of the Debtor’s Repayment Plan should be discharged by the Court at the conclusion of the case (often a savings of a majority of the Debtor’s unsecured debt). If you need to file a Chapter 13 Bankruptcy, you will need the advice of an experienced attorney to assist you in preparing your case, filing your case, and representing you throughout the process.
Chapter 7 Bankruptcy Frequently Asked Questions
1. How do I qualify?
In order to qualify for a Chapter 7 Bankruptcy discharge: you must not have filed a Chapter 7 Bankruptcy that resulted in a discharge in the past 8 years or filed a Chapter 13 Bankruptcy that resulted in a discharge in the past 6 years; your household income must either fall below the median income level for a household of your size in the State of Virginia or you must have allowable expenses that bring your income below the median income level for your household. There are a few other ways an individual may qualify for a Chapter 7 Bankruptcy that are not typical and are very fact specific and should be analyzed by an experienced attorney before you undertake to file a Chapter 7 Bankruptcy.
2. How long will this take?
The actual length of time it takes to prepare an individual case for filing with the Court is highly dependent on the person seeking bankruptcy relief and the financial situation he or she finds themselves. The more motivated the person and the faster he or she brings in his or her documents and completes all other required steps, the faster the case can get filed with the Court.
Once the case is filed with the Court, it generally takes three to four months for a standard no-asset Chapter 7 Bankruptcy to be discharged and closed by the Court. If a case is more complicated (has creditors who are objecting to discharge or the Debtor has assets that the Trustee asserts should be liquidated to pay off debts), it could be substantially longer between the time of filing and the date the case is closed. There is no finite schedule for a bankruptcy case given the uniqueness of each individual and his or her financial situation and the general guidelines set forth here are not a guarantee that a case will be resolved within a set time frame.
3. What paperwork will I need?
Every person filing for Chapter 7 Bankruptcy will need to produce documents that evidence their income (i.e. paystubs or operating statements as well as tax returns), expenses, assets (including deeds, titles, deeds of trust, tax assessments, and DMV transcripts as applicable), and debts. These documents are not only essential for your paperwork to be correctly prepared but are also oftentimes necessary for your attorney to produce to the Trustee. During the consultation, an attorney from TGB will provide you with a list of documents you will need to produce that are specific to your situation.
4. Can I keep my car?
If you own a car or cars outright and the value of that car or cars is below the allowable exemptions available to you under the law, then yes, you can keep your car or cars. There are certain limited situations where the Trustee may request you pay a portion of the value of an unprotected car and he will transfer those funds to creditors so that they receive some repayment in exchange for allowing you to keep the asset.
If you own a car or cars that are financed with a creditor, then you may only keep that car or cars if you agree to repay the debt owed on it or them. Repaying that debt usually requires you sign an agreement with the lender that will make that debt survive the bankruptcy (meaning if you later are unable to pay that debt, you may be subject to collection efforts including repossession, lawsuits, judgments, garnishments, and phone calls). In some circumstances, you might be able to redeem the car by paying a lump sum settlement that is less than the amount owed in exchange for the title. Keep in mind that as set forth above if there is equity in the vehicle or vehicles that cannot be protected using an allowable exemption, then the Trustee may force a sale of the car or may ask you to pay a portion of the value of the car.
Chapter 13 Bankruptcy Frequently Asked Questions
1. How do I qualify?
In order to qualify for a Chapter 13 Bankruptcy, you must be an individual who has regular income and has debts that are below the debt limits (currently $383,175.00 in unsecured debt or $1,149,525 in secured debt) and not have had a discharge in a prior bankruptcy within the past several years. An experienced attorney can and should describe for you what specific requirements need to be met for successive bankruptcy cases.
2. What paperwork will I need?
You will need to provide documentation to establish your income, expenses, assets and their values, and debts. It is very important that you timely and completely provide all of the requested documents or your case will not be allowed to proceed. An attorney from TGB will work with you to identify the documents and paperwork you will need for your specific case.
3. How long will this take?
A Chapter 13 Bankruptcy involves a debt repayment plan that lasts for between three and five years before a Debtor receives a discharge of his or her remaining debts.
4. What is the minimum amount of debt?
While there is no minimum amount of debt required to file a Chapter 13 Bankruptcy, you would not want to file for bankruptcy where the debt that you have is manageable with some creative financial budgeting or some other non-bankruptcy alternative. An experienced bankruptcy attorney will work with you to identify if your financial situation is one where you would benefit from filing a bankruptcy or would be better served by some other remedy outside of bankruptcy.
5. What are the fees and expenses?
We encounter questions very often about the cost of filing for Bankruptcy. While we completely understand the people who come to TGB for bankruptcy assistance are suffering from some extremely difficult life situations, we must charge a fee that is as low as is possible but allows us to provide quality, effective representation for our clients. Most attorneys will not estimate the cost of a bankruptcy until they have had an opportunity to meet with you and assess your unique financial situation. However, if you are quoted a price for a Chapter 7 Bankruptcy, please be mindful of what the quoted price covers and especially whether it includes the following (which are required for any case and may be charged in addition to the attorney’s fees):
|Bankruptcy Court’s Filing Fee|
(required in ALL cases)
|Homestead Deed Filing Fee|
(required in MOST ALL cases)
(required BEFORE case may be filed)
|$25 to $50||Approved Credit Counselor|
(can be paid after case is filed but is required BEFORE case may be discharged and closed by the Court)
|$25 to $50||Approved Credit Counselor|
Unlike in a Chapter 7 Bankruptcy where the fees and all costs will need to be paid prior to filing the case, only the Court’s Filing Fee of $310 and the required credit counseling, credit report, and other out of pocket expenses must be paid prior to the filing of a Chapter 13 Bankruptcy case. Typically, all Attorney Fees will be paid through the Chapter 13 repayment plan over time.
When will you start working on my case?
After your initial consultation and once you decide to move forward with a bankruptcy filing with our office, we ask that you make an initial non-refundable deposit of $100.00 to be applied toward the total cost of your bankruptcy (regardless of whether you decide to file a Chapter 7 or a Chapter 13 Bankruptcy).
While you do not have to make this payment right away, TGB is not able to begin work on your file until such initial payment is made. This deposit evidences your commitment to proceed with the bankruptcy process and allows us to not only begin processing your information but also allows us to release to you a copy of your consolidated 3-bureau credit report as well as instructions and a payment coupon for obtaining your required pre-bankruptcy credit counseling.
Upon request, we will also provide proof to your creditors that you have retained an attorney for purposes of filing a bankruptcy; this proof is meant to reduce the amount of direct collection calls and communications you receive but its success is dependent on the individual creditor’s policy.