As the number of bankruptcies rises across the country with continued consumer credit spending and economic struggles, West Virginia is in the middle range of bankruptcies per capita in the United States. As the economy and society has changed, so have the laws regarding bankruptcy. Originally designed by the federal government, the various bankruptcy forms are added to and altered by each state government. But even before looking into these complexities, much should be taken care of and assessed.
Finding a Bankruptcy Attorney
Bankruptcy attorneys are strongly suggested for any individual or business planning to file bankruptcy. They are experts with financial situations are forecasting. There are a few different forms of bankruptcy available, and although some are more commonly used than others, such as Chapter 7, Chapter 11 and Chapter 13, this does not mean they are the best for every situation. There are many online services available to help debtors find the right attorney for their needs and preferences, but most often personal or business referrals are most successful.
Bankruptcy Options
Though there are more options than those three most commonly used, the majority of individuals will end up using Chapter 7 bankruptcy. However, each of them has specific benefits depending on any given financial situation:
- Chapter 7, a last resort where the debtors possessions, aside from exemptions, are liquidated to repay the creditors, giving it the nickname “liquidation bankruptcy.” However, after this major loss, the majority of debts have been removed.
- Chapter 13, more of a precautionary form of bankruptcy, consists of the reorganization of a debtors finances and the creation of a full repayment plan to all creditors. All possessions remain in the debtors’ possession.
- Chapter 11, a business version of Chapter 13 bankruptcy, allows for the business to maintain operations during the bankruptcy process, while repaying creditors and developing a more productive business plan.
West Virginia Exemptions
Exemptions in West Virginia are determined only by the state regulations, but the federal supplemental exemptions can be used along with them. Generally, a Chapter 7 bankruptcy in West Virginia will leave the following:
|
Homestead |
up to $25,000 |
|
Wages |
up to 80% earned but unpaid |
|
Personal Property |
Household goods including animals and clothing at $400/item up to $8,000, jewelry to $1,000, motor vehicle to $2,400 and any personal injury recoveries to $15,000 |
|
Pensions |
ERISA-qualified, public employee’s |
|
Public Benefits |
Crime victim’s, worker’s, unemployment, veteran’s, social security, disabled general assistance |
|
Tools of the Trade |
Any single trade equipment items up to $1,500 |
|
Insurance |
Full group/cooperative insurance, unmatured life |
|
Miscellaneous |
Burial plots to $15,000, health aids, child support and alimony, $800 any personal property and any unused homestead or burial plot value |
Filing the Petition
To file a petition for bankruptcy to the bankruptcy court, the debtor must first inventory all of their possessions. For those attempting Chapter 7 bankruptcy this is a vital step for two reasons. First, a “means test” must first be passed to determine whether that form of bankruptcy is available to them. Second, any inventory problems could be considered bankruptcy fraud. However, if the response, which usually comes in 20 to 40 days, is positive, all creditors will be notified and a meeting will be scheduled. This is called the “341 meeting” which is especially crucial for those filing Chapter 13, because it is where their repayment plan will be arranged through collaboration with a bankruptcy trustee and the creditors.
