Virginia consumers who are struggling with debt might wonder whether they should file for Chapter 7 bankruptcy. In order to file for Chapter 7, they must pass what is known as a "means test". This means that their income must be below a certain amount, which is usually the median income for the state. However, there are additional considerations in determining this income. For example, certain expenses may be taken into account and deducted from overall income to determine eligibility.
Chapter 7 bankruptcy may help Virginia residents and others seek relief from debt. The process begins by filing paperwork that outlines the debts and assets a person has. Debtors may also be required to produce pay stubs and other financial information to the bankruptcy court. Documents needed to petition for protection from creditors can typically be obtained for free. Prior to doing so, an individual will need to take part in a credit counseling session.
Spiraling health care costs and the overwhelming debt to which it can condemn families been a problem in the United States for many years, and Congress took action to address the issue by passing the Affordable Care Act in 2010. However, a recent study published in the American Journal of Public Health suggests that the landmark legislation has not had the desired effect. In the first major study of its kind since the ACA became the law of the land, researchers discovered that medical debt still plays a role in about two-thirds of the personal bankruptcies filed in Virginia and around the country.
Virginia residents may wonder if student loans can be eliminated through bankruptcy. The quick answer is no. However, there are some exceptions to the rule.
Going through a Chapter 7 bankruptcy can be one of the most stressful moments in a person's life. One way that this process becomes even more burdensome is the way real estate is treated in the disposition process. While a homeowner can claim a homestead exemption, meaning the property can't be dissolved to resolve the debt, that does not prevent a home from being foreclosed upon if the borrower doesn't have the income to cover the mortgage payments.
Those who are struggling to repay their debts may want to file for bankruptcy protection. However, there are certain criteria that must be met to do so. For instance, those who have filed for Chapter 7 bankruptcy protection in the past must wait eight years to file another such case. To convert a Chapter 7 case to a Chapter 13 case, four years must have passed from the date in which the Chapter 7 case was filed.
Many people in Virginia are struggling to make ends meet, and they may find themselves stretching their credit card balances in order to do so. Credit card debt is growing across the United States, and the reasons can vary from financial emergencies to appealing offers from credit card companies. According to the Federal Reserve, revolving consumer debt, including credit card debt, increased across the country by 1.5 percent in July 2018. According to the national bank, American consumers' revolving debt totals $1.037 trillion.
Medical bills could have a major impact on the credit score of a Virginia resident. However, anyone who receives a medical bill may have a variety of protections aimed to limit that impact. For instance, major credit bureaus Equifax, TransUnion and Experian must wait 180 days before putting information about a medical bill on a credit report. In many cases, a medical debt may be removed from a credit report if an insurance company ultimately pays the balance.
Virginia residents who are struggling to pay down debts and putting off filing for bankruptcy might be interested in the results of a report published in the Notre Dame Law Review. The report focuses on the pre-bankruptcy period, sometimes called the sweatbox. Researchers made use of data provided by the Consumer Bankruptcy Project, which gathered information from 3,200 bankruptcies filed between 2013 and 2016. The report takes information from 910 of the 3,200 bankruptcies and comes to some interesting findings.
Some Virginia consumers may find themselves overwhelmed by credit card debt. The efforts of credit card companies to collect on that debt usually begins with letters asking people to pay. However, once those debts go to a collection agency, the pressure may become overwhelming with calls and letters demanding payments. People might then begin to consider bankruptcy.