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West Virginia Bankruptcy

West Virginia Bankruptcy


West Virginia Bankruptcy Law


West Virginia bankruptcy follows law that closely reflects federal law and compare slightly to other states with more strict policies.  West Virginia offers fewer exemptions than most other states, and it’s becoming harder and harder to even file for Chapter 7 in the state.  However, the strict policies are in place not to restrict someone from filing West Virginia bankruptcy, but to help them through a tough economic period and actually save their credit in the long term.  


West Virginia Bankruptcy : Personal and Corporate


If a person or family wants to file for West Virginia bankruptcy, they will generally file under Chapter 7 or Chapter 13 depending on a judge’s decisions and their own personal circumstances.  If a corporations files, it usually declares Chapter 11 bankruptcy.  


WV Bankruptcy : Chapter 7


This type of bankruptcy works well for people or families with large amounts of unsecured debt and low means to income.  In order to qualify for Chapter 7, a person’s income must fall below the average household income in the state of West Virginia: $38,241.  However, even if a person’s income falls below the average income, a judge may still make the individual file for Chapter 13 in certain circumstances.  The unemployment rate is fairly high in West Virginia at 9.1%, so many people may still be able to file for Chapter 7 and qualify for the following exemptions:


• Up to $25,000 homestead

• 80% of wages or 30 times minimum wage

• $9,000 in personal property

• Up to $1,500 for tools of trade


WV Bankruptcy : Chapter 11


If a corporation is facing economic hardship, an owner may decide to file for Chapter 11 bankruptcy.  This measure allows the company to restructure its finances and make other necessary changes during a “grace period” in order to increase profit and decrease owed debt.  The owner of the corporation usually oversees a Chapter 11 and reports back to a judge and creditor.  


WV Bankruptcy : Chapter 13


The main advantage to filing for Chapter 13 involves keeping your property and assets.  An individual or family may either choose or be forced into filing for Chapter 13, and they are required to make monthly payments over the next three to five years (or longer in some cases) in order to reduce up to 25% of their overall owed debt.  




Under Chapter 7, a person’s federal and state tax returns may be obtained by a creditor because these taxes qualify as assets.  The tax returns are generally safe under Chapter 13.  Additionally, backed taxes to the IRS and other collection agencies are not eliminated (in most cases) by filing for West Virginia bankruptcy.  


Filing for West Virginia Bankruptcy


Like in most other states, a citizen of West Virginia must attend a credit counseling course six months before filing for WV bankruptcy.  They must also show evidence of attending a debtor education course before reaching a final settlement.  


If you are considering filing for WV bankruptcy, you should try your best to hire a lawyer.  You can choose to go through a state filing service as well, but a lawyer can help you submit documents and fees on time while helping you reach the best settlement possible with your creditors.  You are required to file the following documents in West Virginia and under federal law:


• Petition

Attorney certificate

• Proof of income

• Proof of net monthly income

• Anticipated changes in income

• Educational individual retirement account

• Tax returns from most recent to as far back as four years