What is bankruptcy?

Bankruptcy is a legal way for individuals or businesses to get out of debt. It is a form of debt relief that can help people who can no longer pay their debts. In Virginia, filing for bankruptcy is done through a court. The court will review your financial situation and decide if you qualify for bankruptcy protection. When you file bankruptcy in Virginia, the court will analyze your total debt, assets, income, and expenses. This will help them determine which type of bankruptcy you are eligible to file. The types of bankruptcy that are available to individuals in Virginia include Chapter 7, Chapter 11, and Chapter 13. Chapter 7 bankruptcy eliminates or reorganizes all of your debts. Chapter 11 is used for business bankruptcies and reorganizes debt into a more manageable payment plan. Chapter 13 is a payment plan where you make regular payments over time to satisfy your debt obligations. Bankruptcy is not a solution for everyone, and it should not be used to avoid paying your debts. It is also important to note that filing for bankruptcy comes with a lot of paperwork and court costs. It may take years to rebuild your credit after filing for bankruptcy, so you should consider other options first if you can.

Related FAQs

Are there any types of debt that will survive a bankruptcy discharge?
How much does it cost to file for bankruptcy?
How long do I have to wait before I can file for bankruptcy again?
Will bankruptcy discharge the entire amount of debt owed?
What is the difference between discharging and writing off a debt?
What is the difference between a voluntary and involuntary bankruptcy filing?
Are there any assets that I will not be able to keep in bankruptcy?
How do I know if I am eligible for Chapter 7 or Chapter 13 bankruptcy?
What is creditor reaffirmation?
Are there any exceptions to the automatic stay issued when filing for bankruptcy?

What is bankruptcy?

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