Answers to Your Most Frequently Asked Questions

You're probably full of questions right now—and that's okay, because we have answers! Check out some of the questions we hear the most about bankruptcy, divorce, and child custody from clients just like you.

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  • Can I keep my house if I file a Chapter 7 Bankruptcy?

    There are two factors that must be considered when you want to keep a house when filing a Chapter 7 bankruptcy. The first factor is whether there is equity in the house. When you file a Chapter 7 bankruptcy, the court appoints an individual, called the trustee, whose job is to try to find assets that he can sell to pay something to your unsecured creditors. If you own real estate, the trustee will determine if he thinks there is equity in the property. This means that he wants to see if he could sell your house for more than is owed on it. If the trustee thinks that he could sell the house for more than is owed on the mortgages and for enough to also cover the costs of selling the house, he will market the house. An experienced bankruptcy attorney will normally determine if there appears to be enough equity in the house that could cause the trustee to attempt to sell the property. Many people owe more on their mortgage than their house is worth so it is unlikely that a Chapter 7 trustee will attempt to sell the property.

    The second factor that will play into whether you can keep your house after filing a Chapter 7 bankruptcy is the status of your mortgage. If you are behind on the mortgage payments when you file a Chapter 7 bankruptcy, the mortgage company may elect to proceed with foreclosure. In a Chapter 7 bankruptcy, there is no way to prevent a mortgage company from foreclosing if the payments are not current. Your mortgage company may be willing to work with you through either a loan modification or forbearance agreement but that is the mortgage companies choice. You can not force them to work with you after filing a Chapter 7 bankruptcy. If you are behind on your mortgage payments and you want to keep your house, you should consider filing a Chapter 13 bankruptcy.

    If you own real estate and are considering filing bankruptcy, you need to consult with an experienced bankruptcy attorney. Contact Hampton Roads Legal Services and we will schedule you a free consultation to discuss how bankruptcy may be able to help you.

  • What does it mean when a case has been dismissed with prejudice?

    A dismissal with prejudice means that the court has made a final determination on the merits of the case, and the debtor is now forbidden from filing another bankruptcy for a designated period of time. This bar from refiling will be set by the Judge in the dismissal order and can be from a couple of months to several years. The dismissal of bankruptcy cases with and without prejudice is authorized by the Bankruptcy Code (the Code). Generally, dismissals are ordered without prejudice. However, if the Court feels that the individual is abusing the bankruptcy process, they may dismiss the case with prejudice. Your attorney can give you a more detailed explanation of a dismissal with prejudice, and every situation is different. If you are concerned, be sure to ask your attorney for more information.

  • What does it mean to be legally separated in Virginia?

    One of the most misunderstood terms in divorce law in Virginia is "legally separated". I get calls every week from someone who tells me that they want to file for a legal separation.

    Action & Intention

    To be legally separated, the state of Virginia does not require any paperwork nor is there anything filed with a Court to be considered "legally separated".  All that is required is to be living separate and apart and that one of the spouses intends to end the marriage. That is it... an action (physically separating) and an intention (to end the marriage). Note that it does not require a mutual decision to end the marriage, only one spouse has to have the intention.

    Proof of Separation Separation

    The larger issue is proving that you are legally separated. When you file for a divorce, you will have to provide evidence that you were legally separated for the required time period. This is normally done with the testimony of a witness that you have been separated for the length of time, that the separation has been continuous and uninterrupted and that you stated your intention to end the marriage. Your witness must have been in a position to know that you and your spouse have been living separate and apart.

    If you are currently separated from your spouse and you are ready to get a divorce, contact Hampton Roads Legal Services at 757-340-3100. We will set you up with a free phone consultation to discuss your situation. 

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  • What should I expect from my first meeting with a bankruptcy attorney?

    Most attorneys offer a free consultation to discuss the bankruptcy process and how it can help you in dealing with your debts. If this is a free consultation, the attorney will normally not spend a great deal of time going over the specifics of your case with you. This is more of a time for you to decide if this is something you want to do and for the attorney to decide if your case is one that he/she will take. When you go to this first appointment, you should have an idea of what types of debts you have and how much you owe. You should also be able to tell the attorney if any of your debts are co-signed with someone else. The attorney will need to know what your income has been over the last few months and from what source you receive income.

    I have a short questionnaire that I ask individuals to complete before I meet with them. This questionnaire has been designed to give me a quick summary of the person's debts and areas that I need to discuss with them. We also ask what is the main problem when you schedule your appointment so I have an idea of what your concerns are. This allows me to focus on what will help you the most.

    Regardless of your situation, the attorney should explain at least what a Chapter 7 and a Chapter 13 bankruptcy will do and how they would apply to your situation. The attorney then should recommend a course of action for you and explain to you why that is the best option for you. It may be that bankruptcy is not the best option and the attorney should tell you that if that is the case.  I know of some attorneys who will try to fit everyone into the same chapter of bankruptcy regardless of their situation. I believe that each situation is different and you should know what will be best for you, not what fits my practice the best. While bankruptcy is Federal Law, the procedures may vary based on where you live. The attorney should be able to advise you what the procedures are in Virginia.

    Finally the attorney should explain the cost of the bankruptcy to you and explain the process that you will need to go through to file a case. This should include the timeline for the case. I believe that you should be in charge of this process. When I meet with you, I will give you options so you can decide what best fits your budget and timeline.

    If you are struggling with bills you can't afford to pay, contact Hampton Roads Legal Services at 757-320-2010. I will meet with you and make sure that you understand what is best for your situation.

  • Can you remove a lien on real estate in a Chapter 7 Bankruptcy in Virginia?

    There are three ways that a creditor can place a lien on real estate. First, you can consent to the lien when you borrow money and pledge your real estate as collateral. This is normally a mortgage or home equity line of credit. However, you may also not realize that you are allowing a creditor to place a lien on your property when you borrow money to finance some type of home improvements. Many times, individuals sign what is called a deed of trust as part of the financing arrangements for a home improvement loan. This is recorded in the land records and gives the creditor a lien against your property that is treated the same way as a mortgage.

    The second way that a creditor may obtain a lien against your real estate is by obtaining a judgment against you and then having the judgment recorded in the city or county where you own real estate. In Virginia, if the Judgment is obtained in the same city or county where you own real estate, it automatically attaches to your property.

    The third way that a creditor can obtain a lien against your property is by a statute or law that allows them to have a lien on your property. For instance, the IRS can file a tax lien in the city where you live and it will attach to your property. The city can also place a tax lien against your property for unpaid real estate taxes.

    In a Chapter 7 bankruptcy in Virginia, you may not remove a voluntary lien such as a mortgage or home equity loan. However, you may be able to remove an involuntary lien such as a tax lien or a judgment lien. If your property is worth less than you owe on the mortgage(s) or if it's value is very close to the amount owed, you may remove an involuntary lien from the property. There are two major factors that must be considered when seeking to remove an involuntary lien. First, is the value of the property. You will have to have an appraisal done to show the actual market value of the property. The second factor is the date that the lien was recorded. The liens attach to the property in the order of the date that they were recorded. I have seen cases where a client had a judgment lien and a second mortgage. The judgment lien was recorded before the second mortgage and could not be removed because the property was worth more than was owed on the first mortgage, even though the property was worth less than the two mortgages combined.

    It should be clear that the removing a lien from your property is something that requires the assistance of an experienced bankruptcy attorney. Before you can even seek to remove a lien, you must know if there is one. I have a lien search done for any of my clients who own real estate that they want to keep so we find out if there are any hidden liens out there.

    If you have tax debt or have been sued over a debt and you own real estate, contact me or call my office today at 757-320-2010. I will meet with you to evaluate if you can remove a lien from your real estate in a Chapter 7 bankruptcy.

  • What are my options to pay arrears on Child or Spousal Support?

    Arrears on Child or Spousal support cannot be discharged or wiped out in a bankruptcy. However in a Chapter 13 bankruptcy, you can pay the arrears as part of your repayment plan. The arrears will be paid without any interest while you are in your Chapter 13 case. It is important to note that the bankruptcy does not stop the state court from enforcing support orders. This means that you can be sanctioned for the failure to pay your child or spousal support payments even though you have a Chapter 13 plan that proposes to pay the arrears. Normally the Division of Child Support Enforcement will stop any collection of arrears on child support while you are in a Chapter 13 bankruptcy though.

    In addition, the bankruptcy code provides that your Chapter 13 case can be dismissed if you are not paying the child or spousal support payments that are due after your bankruptcy has been filed with the Court. It is very important that make sure the regular monthly payments are being made after you file a Chapter 13 bankruptcy.

  • When do creditors have to stop calling me after I file a Chapter 13 bankruptcy?

    One of the best aspects of a Chapter 13 Bankruptcy is what is referred to as the automatic stay. When you file a Chapter 13 bankruptcy, your creditors are immediately prevented from taking further action against you. This means that they cannot call you, continue to send you bills or take you to court over your debt. If they have a garnishment in place, they must release it.  In addition, they cannot repossess your car or foreclose on your house without permission from the bankruptcy court.

    Of course, the creditor has to know about the bankruptcy so that they know to stop all collection actions. After your case is filed, the bankruptcy court will send out notices to all creditors listed on your bankruptcy petition. This is why it is so important to list everyone that you owe money to along with all collection agencies. If there is a pending foreclosure or a garnishment, we will notify the creditor immediately after your case is filed to stop the creditor action. Many times we stop foreclosure sales right before the sale is scheduled to take place.

    One down side of the automatic stay is that many creditors feel that they cannot send monthly statements, like a mortgage statement, even if you indicate that you intend to keep the house. This means that you have to make sure that you are sending your monthly payment to the creditor even if you do not get a statement from them.

    If you are facing a foreclosure or being garnished, we can make them stop. Contact me or call me today at 757-32-02010 to schedule your free consultation to see how a Chapter 13 Bankruptcy can stop creditors in their tracks and help you keep your house.

  • Can you protect a co-signor in a Chapter 13 Bankruptcy?

    Unlike a Chapter 7 bankruptcy which discharges your obligations on unsecured co-signed debts, it is possible to protect a co-signor in a Chapter 13. There are several different ways that the co-signor can be protected. If the debt is a secured debt, you may want to continue making the regular monthly payments directly to the creditor to protect the co-signor. If the debt is unsecured, if can be paid in full through the Chapter 13 bankruptcy. This will protect the co-signor while you are in bankruptcy. However, the Chapter 13 bankruptcy will not pay the interest on the co-signed debt. Once you have completed your bankruptcy and receive a discharge, the creditor can collect the unpaid interest from the co-signor.

    If you have a co-signed debt, it is important that you discuss this with your attorney. You have many options and an experienced bankruptcy attorney can help you to choose the best option for you.

    If you are struggling due to debts that you co-signed on, contact us or give us a call today at 320-2010. We will schedule you a free consultation with an attorney with almost 20 years of bankruptcy experience.

  • Can you stop a garnishment in a Chapter 13 bankruptcy?

    Yes. When you file a Chapter 13 bankruptcy, any garnishments must be stopped. In addition, we may be able to get back the money that has been withheld from your wages or bank account. Garnishments normally run for 90 to 180 days and at the end of the garnishment period, there is a hearing. If your case is filed before that hearing date, we can normally recover any money that has been withheld during that garnishment period. However, these funds must be protected for you and must come out of your wildcard exemptions which has a lifetime limit on it. If the amount that has been withheld exceeds the amount that you can protect, you may have to turn some of the money over to the Chapter 13 trustee as part of your Chapter 13 plan.

    It is important that you meet with an experienced bankruptcy attorney if you are currently being garnished. If not handled correctly, you could lose hundreds of dollars. Contact me or call my office today at 757-320-2010. I will meet with you and discuss how to stop the garnishment and recover the money for you.

  • When should I file for Chapter 13 Bankruptcy?

    A Chapter 13 bankruptcy is a repayment plan. Normally you would file this type of case if you have debts that need to be paid back.

    If you are behind on your mortgage payments and want to keep your house, you can file a Chapter 13 bankruptcy and catch up the missed mortgage payments through the Chapter 13.

    If you are behind on your car payments and want to keep your car, you can pay for the car through a Chapter 13 bankruptcy. Depending on how old the loan is, you may be able to reduce the amount that has to be paid back or you may be able to lower the interest rate on the loan.

    If you have a large amount of tax debt, you can pay it back through a Chapter 13 bankruptcy. In addition, if you have a tax lien, you may be able to pay it off for far less than the amount of the lien.

    There are other benefits from filing a Chapter 13 bankruptcy. You may be able to remove a second mortgage lien from your house. You can also discharge some debts that can not be discharged in a Chapter 7 bankruptcy.

    You may need to file a Chapter 13 bankruptcy if you have equity in a home or have other assets that need to be protected. You may also have to file a Chapter 13 bankruptcy if your income is above a certain amount based on the size of your household.

    Chapter 13s are very complex cases and should not be attempted without the assistance of an experienced bankruptcy attorney. Contact us or call us today at 757-320-2010. We can meet with you and discuss your situation. There is no charge for the initial consultation and we will let you know what will be best for you.

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  • What is redemption?

    When you file a Chapter 7 bankruptcy, one of your options for keeping collateral, like a car, that secures a loan is to do what is called redemption. A redemption is based on the premise that if the collateral was returned to the creditor, all they would be able to recover is the market value of the collateral when they sell it. Since the bankruptcy would prevent them from recovering any additional money from you, they recover is limited to what they can sell the collateral for. The Bankruptcy Code allows you to redeem the collateral by paying the creditor the current market value of the collateral in full satisfaction of their lien. However, you have to make one lump sum payment to the creditor. Most people do not have the ability to make a very large lump sum payment on something like a car but there are creditors who will loan you the money necessary to redeem a car under certain circumstances.

    If you have a car that is worth far less than what you owe on it, redemption may be a good option for you instead of reaffirming a debt. Don't agree to pay back far more than you have to in order to keep a car.

    For more information or to request an appointment, please contact Hampton Roads Legal Services at (757) 320-2010 to see if redemption is a good option for you.

  • What is the difference between legal custody and physical custody?

    In Virginia, there are two types of custody that the court will deal with in a custody case: legal custody and physical custody. Legal custody is the right to make decisions about the child. A court will often award joint legal custody which means that the parents are supposed to cooperate in co-parenting the child. When the parents have joint legal custody, they are supposed to discuss major decisions like elective medical treatment, private school versus public school, extracellular activities and religious affiliation. When ever possible, the parents should try to come to an agreement on these decisions.

    Physical custody is who the child lives with for the majority of the time. This parent is normally referred to as the custodial parent. The custodial parent makes the day to day decision regarding the child but has the responsibility to keep the non-custodial parent up to date on what is going on with the child. Both parents have a right to the school records and to attend parent teacher conferences.

    It is best for the child if the parents can work together on issues regarding the child. If you need assistance in setting up a parenting plan for your child or children, contact Hampton Roads Legal Services at 757-320-2010.

  • What is a No Fault Divorce?

    There are two ways to get a divorce in Virginia.

    Fault Based Divorce

    One way is based on some type of conduct by one spouse that allows the other spouse to seek a divorce. This is commonly referred to as a fault based divorce since it is due to the fault of one of the parties. Grounds for a fault based divorce are things like adultery, abuse or desertion.

    No Fault Divorce

    The second way to get a divorce is through what is normally called a no fault divorce or a divorce based on a legal separation.

    When To File

    In Virginia, you can file for a divorce if you have been legally separated for one full year. You may also file for a divorce if you have been separated for six months, have no minor children of the marriage AND have a separation agreement that both spouses have signed. All three requirements must be present to file for a divorce after a six month separation.

    If you have minor children of the marriage, you will have to be separated for one full year before you can file for a divorce regardless of whether you have a signed separation agreement. Likewise, you must be separated for one full year before you can file for a divorce if you do not have a signed separation agreement regardless of whether you have children.

    What is Required

    To be legally separated the state of Virginia does not require any paperwork. All that is required is that the spouses be living separate and apart and ONE of the spouses intends to end the marriage. It does not require a mutual decision to end the marriage. I always tell people who call me about becoming legally separated that if they move out of the home today and announce to family or friends that the marriage is over, they have become legally separated in the state of Virginia. While it is possible to be legally separated and living in the same house, it is extremely difficult to prove.

    There is a difference between an uncontested divorce and a no fault divorce. You can check out our FAQ about uncontested divorce to see what makes a divorce contested.

    If you are currently separated from your spouse and you want to start on a your new life as a single person, give us a call today at 320-2010. We will set you up with a free phone consultation with one of our attorneys to discuss how you can get a divorce and move on with your life.

  • What is a Reaffirmation Agreement and should I sign one?

    When you file a Chapter 7 bankruptcy, you will have to notify your secured creditors (car loans, furniture loans and mortgage companies) as to what you intend to do about the loan. For loans that are secured by personal property (a car or furniture) , you have to indicate whether you intend to reaffirm the debt, redeem the property or surrender the property. I will address redemption in another post. A reaffirmation Agreement is an agreement to repay the creditor according to the terms of the reaffirmation agreement. Some creditors will offer better terms to get you to reaffirm the debt. For instance, one furniture loan company will cut the interest rate on the loan in half and reduce the monthly payment also. If you sign the reaffirmation agreement and it is entered by the court, you are bound to pay the debt as if you had not included it in the bankruptcy. This means that if you default on the debt, the creditor can take you court, get a judgment against you and garnish your wages or bank accounts. Some car companies take the position that if you do not reaffirm on the car loan, you have defaulted under the terms of the original loan and they can repossess the car even if you are current on your car payments.

    You are not required to reaffirm on a mortgage loan since the collateral securing the loan (the house) is not personal property. It is not a good idea to reaffirm on a mortgage loan unless the creditor has offered you some type of loan modification to do the reaffirmation. 

    If you are concerned about a decision to reaffirm, contact your attorney to discuss your options. Every situation is different, and your attorney can give you the best advice for your circumstances.

  • What is an uncontested divorce?

    An uncontested divorce has nothing to do with whether both spouses agree to get a divorce. It's a divorce where both parties have been able to agree on the important issues surrounding their breakup, like who gets what and who pays for what.  In an uncontested divorce, the parties are able to settle outside of court.

    A big advantage of an uncontested divorce is cost: by keeping things out of the courtroom, it is possible to save a large amount of money. When divorces go in front of a judge, you're at the mercy of the court and its timeline, and this means proceedings may get stretched out over a long period of time. In addition, any time that you are fighting over assets, you will end up paying a great deal in legal fees for the representation.

    Another big advantage of an uncontested divorce is the fact that you are in control of your life and your future. By working things out with your spouse, you are able to decide what happens to your property, where your children will live, and how much spousal support might be paid.  This is usually best, because let's face it--who do you think is in a better position to decide what works best with your situation--you and your wife?  Or a judge who knows little about you other than what's been on a few pieces of paper that have been filed.

    Most couples formalize their agreement through a document called a Property Settlement and Stipulation Agreement, commonly referred to as a "Separation Agreement." This Agreement will be incorporated into the Final Decree of Divorce. This way you don't have to stand before a judge and let her determine your fate. Divorce has a way of flipping your life upside-down, and many people find comfort in having a measure of control over what happens next.

    Although an uncontested divorce is a popular option, it is—unfortunately—not for everyone. If you are leaving an abusive relationship, the situation is probably not ideal for negotiating as equals. Also, some couples harbor such negative feelings about each other than it would simply be impossible for them to sit down together and work out the terms of their divorce.

    If you are thinking about getting a divorce in Virginia, contact the Virginia Beach divorce law firm of Hampton Roads Legal Services at 757-340-3100 for a free report on the divorce process in Virginia.  We can also provide you with a free phone consultation to discuss what we can do for you!

  • What are visitation rights?

    When you are trying to create a child custody plan that works for both parties, as well as the child, the topic of visitation may be put on the table. Visitation relates to the "physical custody" portion of a custody agreement, which is where the child lives on a daily basis.

    If one parent is granted sole physical custody, the other parent should have visitation rights. This means that although that parent is not responsible for the day-to-day care of the child, there are still designated days that the parent will have the child. It is also possible for parents to share joint legal custody—making important decisions together regarding education, religion, and medical care—but then have one parent with sole physical custody and the other with visitation rights.

    Parents do not have to agree on a set visitation schedule, though it is certainly helpful for everyone involved. A fairly regular visitation schedule gives the child some consistency and prevents unnecessary arguments between the parents. A very common visitation schedule is for the noncustodial parent to have the child every other weekend, but again, this does not work for everyone. Any visitation schedule should also address holidays, birthdays, and school vacations. It is very common for parents alternate holidays, for example, the child spends Thanksgiving with one parent and Christmas with the other parent one year and then the next year that is switched.

    Courts will rarely deny a parent visitation rights unless there are extreme circumstances. Because judges believe that both parents should be able to maintain a relationship with the child, they will usually change normal visitation to supervised visitation if there are any concerns about the noncustodial parent.

    If the custodial parent makes it difficult for the non-custodial parent to exercise their visitation rights, the Court may modify the custody to include changing the custody of the child to the other parent. This may apply whether the custodial parent is refusing to allow the visitation or if the custodial parent has made the visitation more difficult by moving out of the area.

    Visitation is also not limited to noncustodial parents. Virginia law allows anyone with a true interest in the child to request visitation; this includes grandparents, stepparents, ex-stepparents, and other family members.

    If you are looking to work out a child custody agreement and visitation schedule, contact the Virginia Beach family law office of Hampton Roads Legal Services at 757-340-3100 today for a consultation.

  • How do I know if I'm eligible to file for Chapter 13 bankruptcy in Virginia?

    Most people who want to file a Chapter 13 bankruptcy will discover that they are eligible to do so. This is much different than Chapter 7 bankruptcy, which has strict guidelines when it comes to qualifying. There are just a few major requirements when it comes to figuring out whether or not you can file for Virginia Chapter 13 bankruptcy:

    You must have a reliable, steady source of income.

    The whole principle of Chapter 13 bankruptcy is making a regular monthly payment over three to five years. You must have enough income to pay your regular living expenses as well as the payment to the bankruptcy court. When determining if you qualify for Chapter 13, your bankruptcy lawyer must review how much you pay for necessities like food and shelter and how much you will have left to pay on your debts. These expenses will be based on where you live in the Tidewater area.

    There's a waiting period if you've filed for bankruptcy before.

    You are allowed to file for Chapter 13 bankruptcy if you've filed for bankruptcy before, but there are waiting periods between filings that must be bet in order for you to receive a discharge. If you previously filed for Chapter 13 and received a discharge, you must wait two years from the filing date of the first case to be able to file a second case and receive a discharge; if you previously filed for Chapter 7, 11, or 12, that length of time is extended to four years. If the required time period has not passed since the filing date of the previous case, you may still file a new Chapter 13 case but you will not receive a discharge at the end of your payment plan. These time periods only apply if you received a discharge in the previous case. If the case was dismissed, you may refile at any time unless the earlier case was "dismissed with prejudice".

    Debts cannot exceed caps set by the government.

    There is a limit to the amount of secured and unsecured debt that you can have if you want to file for Chapter 13 bankruptcy. The specific amounts increase every year based on the Consumer Price Index. Currently, you can have up to $360,475 in unsecured debts and $1,081,400 in secured debts.

    There are other requirements, but these are the primary ones that should help determine if you are eligible to file for Chapter 13. If you'd like to learn more about filing for Chapter 13 bankruptcy in Virginia, contact Hampton Roads Legal Services at 757-320-2010.

  • Can you stop my home foreclosure?

    Yes!  In a Chapter 13 Bankruptcy case, we can stop foreclosure by proposing a plan whereby you bring your mortgage current over time while continuing to make the regular monthly mortgage payment. You will have to resume making your regular monthly payments after your case is filed. You must have the ability to make those regular monthly payments, pay your basic living expenses and make a payment to the Court to bring your mortgage current. Your payment plan to the court will go from three to five years,depending on your income and other debts.

    In a Chapter 7 Bankruptcy case, if you are not current on your payments, the Bankruptcy will postpone the foreclosure until your case is discharged or until your creditor/mortgage holder files a motion for, and is granted, "relief from stay."  Your mortgage company may be willing to do a loan modification after you file a Chapter 7 bankruptcy. However, if you file a Chapter 7 bankruptcy when you are behind on mortgage payments, you may not be able to keep your house.

    If you are concerned about losing your home, please contact us as soon as possible. Foreclosure deadlines are not something to take lightly. Once your home is foreclosed, there is very little we can do to help you. Read our testimonials to see other clients who's homes have been saved at the last minute, and be sure to request one of Attorney Pfeiffer's books to guide you through the process. Again, it is very important that you contact a reputable attorney about your foreclosure before it is too late.

    Call us at 757-340-3100 to schedule your free consultation!

  • Can you remove a lien on real estate in a Chapter 13 bankruptcy?

    There are three basic types of liens on real estate. There is a mortgage lien where you have borrowed money and pledged the house as collateral for the loan. This may be the loan to purchase the house or a refinance of the original mortgage. It also includes home equity loans or lines of credit and second mortgages. You may also have a mortgage lien if you have borrowed money for home improvements. The second type of lien on real estate is a judgment lien. This is where someone you owe money to has filed a lawsuit against you and obtained a judgement. The creditor can then record the judgment as a lien against your real estate. The third type of lien is a tax lien. This can be established by state law or by recording the lien in the public records. If you owe real estate taxes, the city or county that you owe the taxes to has a lien under state law against the real estate. If you owe money to the IRS or the state taxing authority, they can file a lien against all of your property, including your real estate.

    If your property is worth less than is owed on the first mortgage, there are ways to remove the subsequent liens in a Chapter 13 bankruptcy. How and when these liens can be removed depends on the type of lien. If you have a second mortgage or home equity lien of credit, judgments or tax liens, you need to meet with an experienced bankruptcy attorney to discuss what can be done in your situation.

  • Do I qualify for Chapter 7 bankruptcy in Virginia?

    Filing for Chapter 7 bankruptcy can be a great option for many people who are severely in debt, but you do have to qualify for it.

    The main idea of Chapter 7 is that you can have many of your debts discharged. Who wouldn't want that? Prior to 2005, all you had to do to qualify for a Chapter 7 bankruptcy was to show that your living expenses equaled or exceeded your income. There was a perception that people who had the ability to repay some part of their debts were abusing the system by filing a Chapter 7 bankruptcy. Congress made it harder to file a Chapter 7 with the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.

    Determining your eligibility to file for Chapter 7 generally comes down to how much you make. Your income is compared to the median income in Virginia. If you make more than the median amount, you have to take a "means test." The means test will look at how much you make, but also what deductions you can claim. Some of the deductions are set by the IRS and some of them are based on your actual expenses. If there are enough deductions, you could still qualify, even though you make more than the average income level.

    If the means test shows that you still do not qualify for Chapter 7, don't worry! You still have other options. A more popular choice for someone who earns too much to qualify for Chapter 7 is Chapter 13 bankruptcy. Chapter 13 bankruptcy takes your debt and helps you repay it in manageable monthly payments.

    If you are thinking about filing for Chapter 7 bankruptcy in Virginia, contact the Virginia Beach bankruptcy attorneys at Hampton Road Legal Services. Call us at 757-340-3100 to schedule a free, no-obligation consultation.