Frequently Asked Questions

30 Years of Bankruptcy Attorney Experience in Richmond

In the many years we have spent with our clients, several questions have consistently come up. We have listed them, with their answers, below.

If you have any further questions, please feel free to contact us and take advantage of a free consultation with our Richmond bankruptcy attorney!

How Can I Rebuild My Credit After Bankruptcy?

After checking your credit report to ensure that all creditors are marked “filed in bankruptcy”, be certain that you are paying your various monthly bills on time. You can also obtain a credit card, making sure that you pay off the balance by the end of each month, and be certain to avoid car title loans or payday loans.

How Long Will Bankruptcy Stay on My Credit Report?

A bankruptcy filing can remain on your credit for up to ten years. Debts are generally not removed from your credit report, but  filing bankruptcy means that creditors cannot initiate collection on those discharged debts.

Can Filing Bankruptcy Erase My Student Loans?

In general, Student Loans cannot be discharged in bankruptcy. There are exceptions to this rule,  mostly based on the Debtor's inability to work and repay the debt now or in the future, coupled with a good faith finding that the Debtor tried to repay the debt prior to the filing of the bankruptcy case.   The elements to prove that the Student Loan should be discharged can be found in a case decided in the Second Circuit, Brunner v. N.Y. State Higher Educ. Servs. Corp., 831 F.2d 395 (2d Cir. 1987).   At this time, discharging Student Loan debt through bankruptcy is a hot topic in politics, and the law may change in the near future.

Can I Keep My Property If I File for Bankruptcy?

In the case of a Chapter 7 bankruptcy, you are entitled to keep property the law says is “exempt” from creditor claims or has no net value.  In Virginia, there is a specific list of items that the Bankruptcy Court Trustee cannot take from you, and there are other laws that allow you to keep property under a certain value.

Keep the following in mind as you determine what property you will be able to keep:

• The property value refers to current market value, not what you paid for it. The value is likely to have depreciated significantly since obtaining it originally.
• You only need to look at your actual equity in a property, not its full value. For example, if you own a $200,000 home with a $180,000 mortgage, the equity in the property is $20,000, and under current law, you are able to exempt/protect up to $25,000 of that equity.  In this case, the Bankruptcy Court Trustee could not take or sell your home, as there is no equity for him to keep after the sale.

In the case of a Chapter 13 bankruptcy, if your plan meets bankruptcy law requirements, and approved by the Court, you can keep all of your property, regardless of its value.

Will Bankruptcy Wipe Out All of My Debts?

No, the filing of the bankruptcy case will not discharge the following:

• Child Support or Alimony
• Taxes owed from the past 3 tax years, or Taxes owed in which a tax return was never filed
• Loans incurred by fraud, such as giving false information to a creditor to secure the loan
• Debts due to “willful and malicious” harm to a creditor
• Student Loans
• Personal Injury debts caused by driving drunk or under the influence of drugs.
• Court fines

Are Utility Services Affected?

Public utilities cannot deny or interrupt service due to your bankruptcy filing. They do reserve the right to require a deposit for future service, however, and you must pay any bills from after your bankruptcy filing.