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Richmond Virginia Bankruptcy Law Blog

Re-establishing credit after Chapter 7 bankruptcy

People in Virginia who find themselves facing severe financial challenges may end up deciding that filing for bankruptcy is the best way to get out from under their mound of debt. Once this decision has been made, there will be steps to complete the Chapter 7 process but it is also important to focus on how to move forward after the bankruptcy is complete since a better future is ultimately what a bankruptcy can provide for people.

As explained by Bankrate, a consumer will want to focus on re-establishing good credit. Once a Chapter 7 discharge has been received, a person's debt to income ratio will be instantly better than it was prior to the bankruptcy so this will actually help when applying for new credit.

Missed payment on debt just one problem for David's Bridal

A company's ability to manage its debt and maintain a steady stream of cash flow is imperative to its ability to succeed, attain growth and remain competitive. Without a solid financial foundation, other aspects of operating an organization just cannot function and can quickly send everything spiraling out of control.

In a recent press release, it was announced that the bridal extravaganza giant, David's Bridal, has officially filed for bankruptcy protection following the nonpayment of a significant debt. Experts see the somewhat surprising announcement as something that was caused by several different contributing factors including changes in the economy, growing competition among online bridal shops and people choosing to get married later on in life. Trends also seem to suggest that many couples are looking to spend less on their wedding. 

Why were you disqualified for Chapter 7 bankruptcy?

If you filed for Chapter 7 bankruptcy in Virginia and the bankruptcy court converted your case to a Chapter 13 or dismissed it altogether, you may be wondering why. What caused you to become ineligible for liquidation bankruptcy? According to FindLaw, there are several seasons that the bankruptcy courts may have converted or dismissed your case.  

The most common reason that bankruptcy courts deny debtors’ Chapter 7 applications is because their income is too high. This may very well be the case for you. Before approving your application, the courts will put you through a “means test.” The first part of the test requires you to compare your current monthly income with the state’s median income. If your income is equal to or below the state’s current median, you may qualify for Chapter 7. If it is above the state median, the court may deny your application and convert your case to a Chapter 13.

Why are so many large retailers filing bankruptcy?

Recently, it is not a surprise to hear in the Virginia news that a large retailer is filing for bankruptcy. It seems to be a very common occurrence. Many blame online retailers, such as Amazon, or mass retailers, such as Walmart. While Amazon and Walmart may play a role, the real reason why so many are moving to file bankruptcy is to get ahead of their financial troubles.

USA Today explains that many retailers file when they notice their long-term finances look troubling. They want to file now when the financial impact is smaller. They do not want to wait until they get in the red. This allows them to survive the restructuring and bounce back afterward so they do not have to close their doors forever.

Balancing debt: 3 tips to avoid bankruptcy

As someone who has always had a lower amount of debt, you were able to pay your bills on time and make sure they were paid in full or close to it. As you got older, more bills began to add up. Today, between schooling, renting an apartment and other expenses, you rarely have enough to pay everything on time.

Not paying debts on time means higher interest rates and fees for late payments. These expenses add up and create an even deeper hole of debt to climb out of. Fortunately, there are some options for people in your situation.

Maintaining your health is critical during your divorce

You have recently decided to divorce your spouse in Virginia and are beginning to deal with the onslaught of decisions regarding your future that needs to be made. While you may not take a second thought for your personal needs during this busy, frustrating and challenging time, failing to maintain your health can be detrimental to your recovery from divorce. At Ferriswinder PLLC, Attorneys at Law, we have helped many people get through the time-consuming process of getting a divorce. 

Despite the chaos of the changes in your relationship, you are most likely going to need to continue working. Learning to separate your concerns about your divorce from your job is critical to allow you to continue to perform well in your career. Outside of your job, you should make every effort to eat correctly, get enough rest and exercise regularly. These activities will provide you with a break from thinking about factors related to your divorce. Additionally, you may benefit from spending a little time each day on doing something you enjoy. 

What are Virginia's bankruptcy exemptions?

If you have reached the point of considering personal bankruptcy, your first question is one that most in the same financial position in Richmond likely share: "What do I stand to lose?" Bankruptcy is meant to be a tool to help put you back on the path to financial stability. At the same time, achieving that becomes difficult if you have to forfeit up much of your own personal property in the process. For this reason, the law allows you to keep your interest in certain property exempt from bankruptcy proceedings. 

Bankruptcy exemptions work as follows: if the exemption amount covers the equity you hold on a piece of property, you can keep it. If it doesn't, then the bankruptcy trustee assigned to your case will sell the property and then give you money from the proceeds equal to the exemption amount (the remaining would be used to pay off whatever you still owe on the property, and then dispersed to your remaining creditors). 

What are the benefits of Chapter 13 bankruptcy?

When you decide to declare bankruptcy in Virginia, you must then decide which type of bankruptcy is right for you: Chapter 7 or Chapter 13. Chapter 7 bankruptcy, or "liquidation" bankruptcy, as it is commonly referred to as, involves the liquidation of all a debtor's assets to repay creditors. Chapter 13, on the other hand, is a "reorganization" bankruptcy. When you file for this type of bankruptcy, your debts get reorganized in such a way that allows you to repay your debts via low monthly payments over a longer period of time.

Though Chapter 7 is preferable for individuals with few resources to spare, it is not ideal for those with significant assets, such as a home, vehicles or other valuable property. Chapter 13, on the other hand, is. According to FindLaw, Chapter 13 offers numerous benefits that Chapter 7 does not. 

Evercore hired by Sears directors to analyze Lampert deals

Filing for bankruptcy can be a daunting task for anyone, but especially for large companies that are grasping at straws to overcome financial blunders. For struggling companies in Virginia, filing for bankruptcy may bring with it the promising hope that somehow, they may be able to turn their problems around and strengthen their financial foundation to rediscover success. 

In a story that has developed over many years and has recently gained nationwide attention, the once-famed department store Sears is in the throes of bankruptcy proceedings as they are failing to recover from mounting debts that appear to have resulted from poorly managed financial decisions. In a new development to an already chaotic story, some of the directors of Sears have hired Evercore to analyze the decisions made over the past years by former CEO Eddie Lampert. 

What can chapter 13 bankruptcy do for you?

At some point, most people in America find themselves in serious financial hardship. When the idea of filing bankruptcy arises, many consumers who might benefit from it significantly never learn enough about the process to understand what it can do for them.

This unwillingness to consider bankruptcy as a legitimate opportunity to shed debt may cost a person years of hardship.

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