top of page

Bankruptcy FAQs


Would a Chapter 7 or Chapter 13 bankruptcy be in my best interest?

If you are being harassed by debt collectors, being sued, being garnished, or facing foreclosure, it may be time to consider seeking relief under the bankruptcy code. Title 11 of the U.S. code contains the provisions of bankruptcy law, and for millions of Americans, the bankruptcy code provides a fresh start or a chance to reorganize. The administrative office of the U.S. Courts provides the best information, including debt analysis and videos. Click here to read more about it.


Does the "means test" of BAPCPA make it difficult for the average person to file Chapter 7?

The Bankruptcy Abuse Prevention and Consumer Protection Act  (BAPCPA) means test only limits one in 10 clients from pursuing a Chapter 7 petition. There is a major loophole in the test that allows individuals with primarily business debt to avoid the test completely. Most individuals seeking relief readily qualify under that test.


Will the filing of a bankruptcy petition end my chances to get credit or a security clearance in the future?

For most people with a poor credit history, filing a bankruptcy petition will probably not make your credit report much worse. In fact, after the discharge is granted, you will be debt-free and at less risk of default than before the filing. The bankruptcy code provides that no government agency is allowed to discriminate against you on the basis of a bankruptcy filing.


What is the role of credit counseling agencies in my analysis of whether I should file bankruptcy?

Congress requires a credit counseling agency to screen any person seeking to file bankruptcy. You must produce a certificate of this screening to file for bankruptcy. Your case will be dismissed immediately without that certificate. Moreover, during the course of a bankruptcy case, a petitioner must complete a course of financial management and file the certificate of completion. Failure to do so will result in dismissal of the case.


Will I lose all my property if I file for bankruptcy?

Most people who file for bankruptcy get to keep all of their property under the exemptions provided by state and federal law. The bankruptcy code still has an element of providing a fresh start to debtors. In those instances where a person is likely to lose valuable property, a Chapter 11 or Chapter 13 bankruptcy could protect that non-exempt property while requiring the debtor to make payments in a court-approved plan.


What is ECF?

ECF is Electronic Case Filing. Ronald W. Stern, Esq. was one of the first attorneys in the U.S. to commit to this protocol when his judicial district became a pilot project and showed how successful the concept was. Bankruptcy documents are converted into a PDF format and filed by computer. These records are available to the court, Practitioners, and anyone with a Pacer account. ECF also permits instantaneous filing 24 hours a day, 365 days a year, so emergency filings are easily completed. 



Creditor FAQs

What are the major options open to creditors in bankruptcy?

If you are a secured creditor, the most important thing is to seek relief from the bankruptcy stay as quickly as possible. Whatever value you have in the collateral should be realized without further depreciation by the debtor. A creditor may file a proof of claim, but it is often an act of futility as most bankruptcy cases are no-asset cases. You can see on the notice of bankruptcy whether you should file a proof of claim. Objections to bankruptcy can be filed in a limited number of cases, but that is often very costly and can expose you to an award of counsel fees should you not prevail.


What advantages do I have if I sue a debtor in state court?

If you obtain a judgment against your former customer or client, you are in a position to place a lien on any real property or personal property they own. In Virginia:

  • You can garnish the wages of your judgment debtor

  • You can garnish the debtor’s bank account

If you simply wait for your debtor to pay you, you will find that the priorities of your former customer or client do not include you. Contact The Law Office of Ronald W. Stern, Esq. for further legal advice.


What is the life of a judgment in Virginia and is interest allowable?

Judgments obtained in the circuit court have a life of 20 years and 10 years in the general district court. However, if you record the judgment from the latter in the circuit court, that extends the judgment lien to 20 years. Post-judgment interest is routinely awarded at either six percent or the contract rate, and pre-judgment interest may be sought.


Can I hold my customer or client liable for my attorney’s fees to collect my account?

If you have a signed credit application or guaranty that provides for liability of the customer in the event of default, you can demand payment of your attorney’s fees. Most debtors do not voluntarily agree to pay these fees and it may require a ruling from the court for reimbursement. You cannot demand these costs unless you can establish a statutory entitlement for attorney's fees. Even if you have such a provision in your contract, the court may not grant legal fee compensation.


How does the Fair Debt Collection Practices Act affect my case?

When a debt collector is pursuing a retail collection case, he or she must follow the statutory requirements of that act. These requirements include:

  • Giving mandatory notices about the debtor’s right to verification of the debt

  • All information obtained would be used for the purpose of debt collection

If the matter does not involve a retail debt, that act is not applicable to the case.



Contact Ron Stern today

When you need an experienced attorney to assist in your commercial collection or bankruptcy case,

contact the Law Office of Ronald William Stern, Esq.

bottom of page