How does chapter 13 Bankruptcy work in Virginia?

I really should have titled this blog “How does chapter 13 bankruptcy work in Alexandria, Virginia.” Why? Because in each and every jurisdiction things are done just a bit differently than in other parts of the country, or even other parts of the state for that matter. Drawing inspiration from David Letterman and his famous “top 10 list” the following are the top 10 issues to keep in mind if you are thinking about filing a chapter 13 bankruptcy case in Alexandria, Virginia:

  1. There is only one chapter 13 bankruptcy trustee in Alexandria, Virginia and his name is Thomas (goes by Tom) Gorman. If you are shopping around for a chapter 13 bankruptcy attorney in Northern, Virginia, your attorney should certainly know who he is. And yes, he is a pretty nice guy, and has a great sense of humor to boot.
  2. The meeting of the creditors will take place in Old Town Alexandria and it will always be on a Tuesday. For most people, this will be your only “court appearance.” It is at this hearing that you will be meeting with the trustee, Thomas Gorman. Unlike other places, if no objections are filed to your proposed plan, then there will be no need for you to appear at the Confirmation Hearing.
  3. Alexandria is unique in that the judges have decided that in chapter 13 cases, the post filing course, the debtor education course, needs to be taken in person (instead of online) on the day of the meeting of the creditors. The class will begin at 9:45am and is designed to answer whatever general questions you may have about the chapter 13 process.
  4. Unlike Washington, DC for instance, once you file your chapter 13 case you will be responsible for making the first several monthly payments to the chapter 13 trustee before the court will issue a Wage Order commanding your employer to begin deducting these payments from your pay check. The court will issue this Wage Order once your plan has been confirmed. In DC that Wage Order will be issued within a matter of days of the filing of your case.
  5. Unless you are filing a “100% plan,” the chapter 13 trustee will expect you to produce your tax returns each to him each and every year while you are in bankruptcy and will expected you to turn over to him any tax refunds you get that are in excess of $250.00! Of course, your experienced chapter 13 bankruptcy attorney can tell you how to fairly easily avoid having to “donate” any of this money over to the trustee.
  6. In Alexandria things are set up so that you will continue to make your normal mortgage and car payments once you file your case, while the trustee will use the money you pay him each month to catch you up on your mortgage/car arrearage, if any. In other parts of the country, the trustee will make all payments on your behalf. Basically, the courts there do not trust you to directly make your own mortgage/car payments while in bankruptcy.
  7. Some parts of the country are extremely tough about missing your chapter 13 payments. As in, miss one payment to the trustee and your case gets promptly dismissed. When they say no excuses, they mean it! In Alexandria, I will tell you from experience that the trustee tends to be understandable and reasonable.  You will usually get a second or even a third bite at the apple before your case gets dismissed for lack of payments to him.
  8. The two judges that we have in Alexandria are not here to “rubber-stamp” the objections of the chapter 13 trustee. Meaning, if the trustee objects, and you insist on having the matter heard before the judge, then as long as the facts and/or law are on your side, there is no reason to doubt that the judge will rule in your favor.
  9. If you are thinking about trying to dispose of a judgment lien on your home, or a lien strip, an appraisal will certainly be required by the judges.
  10. I cannot think of # 10 at this time.


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