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Michael D. Hart, P.C.
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chapter 13 bankruptcy Archives

How a bankruptcy impacts a debtor

Those in Virginia who are thinking about filing for bankruptcy should know that the process can do significant damage to a credit score. However, it is possible to minimize the damage over the long-term. By taking out a secured credit card or a credit builder loan, a debtor could start to establish a timely payment history.

Credit card debt is becoming a national problem again

Credit card debt declined significantly during the Great Recession but that trend appears to be over. According to data recently compiled by WalletHub, Virginia families now have as much debt as they did prior to the recession. This means more people might be struggling to pay their bills. There are a couple of reasons why credit card debt is so high.

Fed chairman discusses student loans and bankruptcy

Virginia residents who have student loan debt are generally unable to discharge those obligations in bankruptcy. While there is a provision for discharging these types of debts if they cause "undue hardship", this is a term that has never been clearly defined, and courts have traditionally set a very high standard for what it constitutes.

Keeping or buying a vehicle and Chapter 13 bankruptcy

Chapter 13 bankruptcy is a legal process in which debtors use their disposable income to pay off their debts. Virginia debtors who are in some stage of the Chapter 13 bankruptcy process may find that it is possible to purchase a new vehicle or keep the one that they have already purchased; however, the process they use may vary.

Not all credit card debt is created equal

Federal Reserve data indicates that credit card debt in the United States passed the $1 trillion mark in 2017. This may have implications for the financial health of Virginia residents and others. A study by CreditCards.com sought to rank the 25 most populous cities by the average amount of credit card debt residents held. Washington, D.C., had the most debt with the average person having a balance of $7,442.

Pros and cons of using a loan to pay off debt

Virginia residents and others who have debt are likely to be paying off car loans, student loans and credit card balances. They may also be paying down home mortgages. The typical American household that does carry debt averages $131,431 owed to creditors. Some believe that taking out a 401(k) loan is the best way to take care of those and other debts.

What trustees do in a bankruptcy

The role of a trustee in bankruptcy varies depending on whether the person has filed for a Chapter 7 or a Chapter 13 bankruptcy. In either case, when a Virginia consumer decides to file for bankruptcy, it is necessary to complete a document that lists assets, debts, property and expenses. A trustee may ask for additional information such as pay stubs.


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