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Bankruptcy
TO THE READER: This pamphlet contains general legal information. For advice regarding your particular legal problem, you should contact an attorney.
1. WHAT IS A BANKRUPTCY?
Bankruptcy is where you ask a special federal court (the United States Bankruptcy Court) to have your debts to your creditors reduced or discharged (that is, wiped
out). Individuals generally choose to file one of two types of bankruptcies:
Chapter7, or straight bankruptcy involves turning over any of your assets (property worth money) which you are not able to protect to a bankruptcy trustee and obeying all
orders of the court. The trustee will try to sell off any property you cannot protect and pay the money to your creditors. The court will then issue a discharge order releasing you from your remaining
debts and ordering your creditors not to attempt to collect them from you. Certain types of debts cannot be discharged in a Chapter 7 proceeding and creditors can still seize any collateral or foreclose on any
mortgages which they have securing a debt.
Chapter 13 wage-earner plan is for debtors who have regular incomes, can meet their day-to-day living expenses, and have one or more large secured debts, such as a home
mortgage. You would file a repayment plan which proposes payment of all or a portion of your debts over a period of up to five years. The plan must be approved by the court, which will require that
certain debts such as taxes, alimony and child support be paid in full. Creditors cannot take action to collect on their debts while the plan is in effect.
2. IS A BANKRUPTCY RIGHT FOR ME?
Bankruptcy should always be viewed as a last resort. Your decision to file or not to file should be based on a hard look at your financial situation, not on
emotional reasons such as feelings of being overwhelmed or of wanting to just end your financial problems as quickly as possible. You can only resort to bankruptcy once every six years, and because many of
your exemptions (ways to protect your property from seizure by the bankruptcy trustee) cannot be used a second time, a second bankruptcy is usually not as effective as the first. If you do not have enough
money coming into your household to pay day-to-day living expenses, your problem is really one of not enough income. Bankruptcy not only will not solve this problem but could even make it worse if you ran up
large debts due to your lack of income before the six years are up and have nothing to fall back on.
Timing is therefore a crucial consideration in any decision to file a bankruptcy, particularly since you usually cannot add any debts that you run up after the date the
bankruptcy is filed. You shouldn't file a Chapter 7 if you expect to run up large additional debts in the near future, or if you expect to receive a large asset which you cannot protect such as an income tax
refund, an inheritance or a divorce settlement.
You shouldn't be filing bankruptcy if you have no garnishable wages or some important property that cannot be protected by an exemption and is in danger of being seized by
a creditor -- if you don't have these things, what is the point? The questions to ask yourself are: what property or income do you need to protect?; and will a bankruptcy protect it? Even if you have
garnishable wages, you ought to wait if none of your creditors has taken you to court or if the judgments against you are old and no garnishments or attachments (seizures of property) are in progress.
Finally, you should be very wary of filing bankruptcy if you do not have adequate health insurance for yourself and your family. Without insurance, an unexpected
illness after bankruptcy could financially ruin you.
Bankruptcy may be right for you if you would have enough income to meet your day-to-day expenses except old debts dragging you down. No governmental agency can deny
you any license or privilege, or discriminate against you in any way, because of a bankruptcy. Private employers are also prohibited from firing you or refusing to hire you just because of a bankruptcy.
Your bankruptcy can be carried on your credit record for up to ten years and is certainly not a positive factor on a credit report. However, most persons on the verge of bankruptcy have poor credit reports
anyway, and find that a bankruptcy does not do any significant additional damage to it.
A word about joint bankruptcy for husbands and wives:
If some of the debts to be discharged are owed by both, then both husband and wife should file a joint bankruptcy. If only one spouse files, creditors can still try
to collect jointly owed debts from the other spouse.
3. HOW MUCH DOES IT COST TO FILE A BANKRUPTCY
The filing fee is currently $191 for an individual and $206 for a husband and wife filing jointly, and another $18 will probably be needed to file a homestead deed ($36 in
a joint case). These fees cannot be waived. Private attorneys generally charge $600-$800 or more for a simple bankruptcy.
4. HOW DOES FILING A CHAPTER 7 AFFECT LAWSUITS OR OTHER EFFORTS BY MY CREDITORS TO COLLECT THEIR DEBTS?
When your bankruptcy case is filed, the court immediately orders creditors to stop any action to collect your debts. This is called an automatic stay. The
creditors cannot sue to get a judgement, continue a garnishment, repossess property, or even contact you about your debts. If a creditor continues collection activity after becoming aware of the automatic stay, he
can be held in contempt of the bankruptcy court.
5. WILL I HAVE TO GIVE UP ANY OF MY PROPERTY?
Maybe. You are required to turn over to the bankruptcy trustee any property of significant value that you own which you have not been able to protect with an
exemption. The trustee will sell this property and use the money to pay off your creditors on a pro rata basis. However, most people of limited income will not have to lose any property to the trustee because
most of their assets are exempt. There are two primary types of exemptions, a homestead exemption and the poor debtor’s exemption.
The Poor Debtor’s Exemption
permits you to keep certain basic possessions such as clothing, the family bible, wedding rings, beds, dressers, stoves, dining room table and chairs, dishes and flatware, pots and pans, and a refrigerator. One car can be exempted in this way if its equity value does not exceed $2,000. If one of your debts is for the purchase of one of these items, however, and your creditor has collateral or a security interest in the property, he will be able to repossess this item notwithstanding this exemption unless you agree to a reaffirmation (see below). Common items which are not protected by the Poor Debtor’s exemption are television sets, stereos, guns, cameras, lawn mowers, etc.
A Homestead Deed
allows you to protect $5,000 worth of property of your choosing. If you are filing a joint bankruptcy with your spouse, you together can homestead up to $10,000 worth of property. As with the Poor Debtor’s exemption, you cannot homestead property in which a creditor already has collateral or a security interest, but otherwise there is not limitation on what kind of property you can protect. You don’t have to file bankruptcy to use all or part of your homestead exemption and many debtors use it to prevent creditors who have gotten court judgments from having the sheriff seize a particular piece of property and sell it at auction. However, homesteads can only be used once- if, for example, you homestead a $4,000 a car, you will have only $1,000 left to use in your lifetime.
REDEMPTION:
Many times, the collateral for a debt is worth less than the amount of the debt -- for example, you borrowed $2,000 from a bank to buy a car which is now worth only
$1,000. In that case, you are allowed to redeem the creditor's collateral by paying him the value of the collateral -- that is, if you pay the bank $1,000, you can keep the car and not pay them the
additional $1,000 you owe. The major drawback to this is that you usually have to pay whatever the collateral is worth all at once.
REAFFIRMATION:
If a creditor has some collateral or a security interest in your property, then even though your debt to him will be discharged by the bankruptcy, he will still be able to
repossess the property. (This creditor right is more limited in Chapter 13 cases.). If you want to keep the property which is collateral for a debt, you may be able to do so by reaffirming the debt. This
means that you would ask the bankruptcy court for permission for that particular debt to survive the bankruptcy, and that you would agree to pay the creditor what you owe. The court will approve reaffirmation
agreements only if it is convinced that you will be financially able to pay the debt after bankruptcy.
6. DO I HAVE TO BANKRUPT ALL MY DEBTS?
Yes. You must list all your creditors (that is, the people you owe). It is a federal felony to knowingly fail to list a creditor. This even includes relatives and friends
to whom you owe money. If, after bankruptcy, you wish to repay a discharged debt you are perfectly free to do so. However, the creditor can make no attempt to collect a debt unless the bankruptcy court has given
permission for the debt to be reaffirmed. Not all debts can be discharged. With some exceptions which your attorney will discuss with you, you cannot discharge debts for back taxes, alimony and child support, fines,
willful injury to someone or their property, or a debt you forgot to list. Student loans also are generally not dischargeable. All of the above-mentioned debts except support, however, can be discharged under
certain circumstances in a Chapter 13 proceeding.
7. WILL I HAVE TO GO TO COURT?
Yes, usually twice. At the first hearing, called the creditor's meeting, you will be asked questions about your assets under oath. At a later court date, called the
discharge hearing, the court will explain to you about the discharge of your debts. The process usually takes about three months, or longer if a creditor contests some aspect of your case.
Debts and Collection
TO THE READER: This pamphlet contains general legal information. For advice regarding your particular legal problem, you should contact an attorney.
If you owe someone money, you are a debtor. The debt could be for credit cards, a car loan, hospital bills, furniture or appliances you have purchased, or a bank loan.
Since our economy runs on credit, almost everybody is a debtor. The person or business to whom you owe money is called a creditor. Creditors have the right to be paid if the debt is justly owed, but debtors have
rights, too. This pamphlet is about things a creditor can and cannot do to you as a debtor.
1. HOW CAN A CREDITOR TRY TO COLLECT A DEBT?
If you do not pay a debt when you are supposed to, the creditor can try to collect the
debt in a number of ways. The creditor can:
1. Report the debt to a credit bureau and damage your credit rating.
2. Try to pressure you into paying the debt or turn the debt over to a collection
agency which will then try to do so.
3. If the debt is secured (that is, if you put up any collateral for the debt), attempt
to repossess the collateral.
4. Take you to court to get a judgment against you. By itself, a judgment is
simply a court document saying that you owe a creditor a certain amount of money. You cannot go to jail for owing someone money unless you fail to pay court-ordered child or spousal support, or are
guilty of tax evasion, or if you fail to pay court-ordered restitution as part of a criminal conviction. But a judgment does enable a creditor to use certain collection procedures that are not otherwise available.
2. HOW CAN I STOP CREDITORS FROM HARASSING ME?
Creditors trying to collect their own unpaid debts are allowed to do more than third party collectors. The law allows a creditor to use any reasonable legal means to
collect. That means they can write or call you at reasonable hours. However, they may not threaten, harass or lie to you, your family members, your employer or others.Many creditors turn their unpaid debts over to
collection agencies that then try to pressure you into paying the debt. Remember that their bark is much worse than their bite. A collection agency that is not a lawyer or law firm cannot take you to court or
threaten to do so. The federal Fair Debt Collection Practices Act prohibits collection agencies from using unfair or abusive collection practices as described below:
Harassment and Abuse. A debt collector cannot use threats of violence or harm to a debtor or to a debtor's family, property or reputation. Misuse of the telephone --
repeated calls to harass or annoy, calling without giving full identification, or calling at all hours of the day or night -- is also against the law.
Falsehoods. Debt collectors cannot lead you to believe they are lawyers or government agents or that they work for a credit bureau when actually they don't. They cannot
misrepresent the amount you owe, or falsely suggest you committed a crime by not paying, or using any false or deceptive means to collect a debt.
Privacy. Debt collectors cannot violate your privacy by sending you a collection notice by postcard, or in an envelope marked collection or by anything else that might
indicate something inside concerning a debt you owe. They may not publish your name as a debtor or in any other way advertise your debt or you as a debtor. A debt collector is allowed to call your friends or your
boss to verify where you live or work but may not discuss your debts with them or with anyone other than you without your permission or the permission of a court.
Unfairness. If a debt collector should call you collect or send you a telegram collect, you do not have to accept the charges. Debt collectors cannot charge you additional
interest or fees other than those authorized by law or the contract you signed creating the debt. They also cannot deposit your postdated checks before the date you have agreed upon (it is not a good idea to send a
creditor or bill collector a postdated check anyway).
The Fair Debt Collection Practices Act also sets up a debt verification process for your protection. Within five days after you contact him, the debt collector must send
you a written notice telling you how much you owe, the creditor to whom you owe it, and what to do if you do not think you owe all or part of the debt. If you dispute the debt, you should write the debt collector to
say so and why. Under the Act, the collector must stop contacting you after receiving such a letter until he or she mails you a verification of the debt.
Even if you do not dispute the debt, the Act allows you to write the debt collector to tell them not to contact you any more. Use the sample letter at the end of this
pamphlet as a guide (unfortunately, it only works for collection agencies, not for creditors who are collecting their own debts). Keep a photocopy for your records and send the letter by certified mail, return
receipt requested, so that you can latter prove the agency got it. The debt collector is then allowed to write you one more time to confirm that the letter was received and to outline what further collection steps
will be taken next. If a collection agency continues to contact you after you have written them to stop or otherwise engages in any of the prohibited practices discussed above, you can file a complaint with the
Federal Trade Commission, the Virginia State Corporation Commission or any organization which exerts some control over third party collectors. You may also want to talk with a lawyer. Under the Act, you can sue and
recover actual damages including lost wages, the cost of an unlisted phone number and physical injuries if they are the direct result of the collector's violations. You can also be awarded statutory damages up to
$1,000 even if you cannot prove actual damages.
3. WHAT ARE MY RIGHTS WHEN A CREDITOR REPOSSESSES PROPERTY?
Most debtors are not aware that they do not have to allow a non-court repossession to take place. The law prohibits a creditor or a third party collector from breaching
the peace in attempting to repossess the collateral. Breaching the peace does not mean you have to use physical force to object -- you should never do that. It is enough that you simply refuse the creditor or
third party collector permission to enter your home or notify them that you object to their taking the collateral. Where the debtor has made his or her objection clear, the creditor or third party collector is
required by law to withdraw and proceed in court to recover the property.
If you have put up property as collateral for a debt, or if you are paying for something (a car or furniture, for example) in installments, that item is security for the
debt and can be taken by the creditor if you fail to make the payments. The creditor can do this without taking you to court. This is the situation typically thought of as a repossession.
The agreement you signed will probably tell you how long you have after a payment is due before your creditor may repossess the collateral. In the case of consumer goods,
the law gives you a ten day grace period after default during which your creditor may not repossess those goods. Often the creditor first sends a letter saying that the loan has been accelerated. That means that the
entire balance of the loan is now owing and due, not just the missing installments, and would have to be paid in full to stop a repossession.
To get court permission to repossess the collateral, the creditor would file a warrant in detinue listing the property and its value. The creditor would have to prove at
the hearing that the property was legally given as collateral and that you are at least ten days behind in your payments (more if the contract requires it). If this is proven, the judge will enter an order giving
the creditor the right to take the property. A sheriff's deputy will then help the creditor to reclaim the property and you would have no right to stop this.
RIGHT OF REDEMPTION: Even after the creditor has repossessed the collateral by himself or through court, you still have a limited right to redeem it, that is, to get it back, by paying the
debt in full along with any reasonable costs incurred by the creditor in repossessing the collateral. You must do this before the creditor resells the collateral .
Once the collateral is repossessed, the law requires the creditor to resell it in a commercially reasonable mannerin order to get a fair price for it. Before selling it,
the creditor is required to give you notice of how and when the collateral will be sold, usually ten or more days in advance of the sale. With this information, you may want to try to find someone who is interested
in buying it. Proceeds from the sale are applied first to the costs of repossession and re-sale and then to your debt. If the collateral sells for more than what you owe, you are entitled to the money that is left
over. If, as is more usual, it sells for less than what you owe, the creditor can take you to court to get a deficiency judgement for the difference.
A creditor who has repossessed your property may notify you that, instead of selling it, the creditor wants to keep it as payment in full for your debt. If you do not
object within 21 days, the creditor may then do so. If you object, the creditor must sell the property. You would typically object if you thought resale would result in a surplus to which you would be entitled. A
special rule applies if you have already paid at least 60% of the cash price or of the loan. In that case, a creditor can keep the property and not resell it only if you sign a statement allowing him to do so. If
you think a creditor has violated your rights regarding repossession of collateral, you should contact a lawyer immediately to see what can be done about it.
4. WHEN AND HOW CAN A CREDITOR SUE ME?
If you are behind in your payments for a debt, the creditor has the option of suing you in court. You can be sued even if you have no money to pay the debt, or even if you
have been making small payments each month, if those payments are less than the contract calls for and are not enough to satisfy the creditor. Keep in mind that the issue in such a lawsuit is not whether you can
pay, or even if you ever will pay, but whether you in fact owe the money. A court action to recover a debt is a civil law suit and should not confused with a criminal case. Again, it is not a crime to owe someone
money. You cannot be fined or put in jail except in a situation where you have failed to pay court-ordered child or spousal support, or are guilty of tax evasion, or have not paid court-ordered restitution as part
of a criminal conviction. Except in those instances, the judge simply decides whether you really owe the creditor a debt, and if so, how much you owe. If you do, the decision of the Court is called a judgment.
A creditor typically sues a debtor in General District Court by filing a Warrant in Debt or, less frequently, a Motion for Judgment. The sheriff then serves the warrant or
the motion on the debtor either by giving it to the debtor directly, or to a member of the debtor's household, or by posting it on the door of the debtor's residence.
The law allows a creditor to sue a debtor only where the debtor lives or where the business with the debtor was transacted. You cannot be sued in a far away city such as
Richmond if you did not deal with the creditor there. If you are sued in a distant court, you have the right to have the location of the case, called venue, transferred to a local court. The court paper you receive
will explain how you can ask for venue to be transferred. All you need to do is immediately write a letter to the court where the case was filed stating that you do not live there and never did business with the
creditor there. State the county where you do live and ask that the case be transferred there.
5. DO I HAVE TO GO TO COURT? IF I GO, WHAT CAN I EXPECT?
RETURN DATES: In Stafford, King George, Caroline and Spotsylvania Counties and the City of Fredericksburg, all the judge does on the return date is determine whether the case is being
contested -- if you appear and tell the judge you are contesting, a hearing on the matter is scheduled for another date and time.
In a civil action such as a warrant in debt, warrant in detinue or a motion for judgement, you do not have to go to court -- that is, you cannot be arrested for failing to
show up. However, if you do not appear, the judge will check the court papers to see if you have been served. If you have, the judge will assume that you did not appear because you agree that you owe what the
creditor is asking for and, if the creditor appears and brings supporting documentation, the judge will enter a default judgment against you. If you agree that you owe what is being asked for, there may be no point
in appearing in court. However, even if you would like to work out a payment plan but you agree that you owe the money, you should go to court and talk to the collection attorney. Then your agreement would be
entered as a court order. BUT DO NOT MAKE THE MISTAKE OF THINKING THAT YOU CAN AVOID A JUDGMENT BY NOT SHOWING UP!
If you believe you do not owe the creditor money, or that you owe less than what the creditor is asking for, it is therefore important that you appear on the date
indicated on the warrant, called the return date. If you cannot go, or cannot defend on a particular day, contact the Clerk of the General District Court to request a continuance (a postponement until a better day
for you). Any oral or telephoned request for a continuance should immediately be followed up by a request in writing. If you are going to ask for a continuance, you should do so as far in advance of the return day
or hearing day as possible. But it is up to the judge to decide whether to grant your request or not.
On the trial date, be sure to bring any papers or receipts that relate to the claim and any witnesses who can speak for you. To ensure that a witness appears for the
hearing, ask the Clerk of the General District Court for a subpoena ordering the witness to come (you will need the street address, not a P.O. box, of the witness so that he or she can be served). A subpoena must be
requested at least ten days before the hearing. If you have a serious dispute, you should consult with a lawyer or have a lawyer represent you in court. If you intend to get a lawyer to represent you, you should
contact one as far in advance as possible. If you do not feel that the judge came to the right decision in your case, you have up to ten days after the hearing to note an appeal with the General District Court
Clerk. Usually an appeal bond will then have to be posted within 30 days of the hearing.
6. WHAT IS THE EFFECT OF A JUDGMENT?
Once a debt is reduced to a judgment, interest is added to the amount owed until it is paid off -- this can start on the date of judgment or earlier if the judge decides
to set it earlier. The interest rate is generally 9%, but it can be higher than that if the debt is due to a contract and rate stated in the contract is higher. Because of the interest, you will have to pay more
money the longer you delay paying the judgment off.
Once a judgment is properly recorded, it becomes a lien against any land that you own. That means that if your land is sold, the judgment plus accrued interest must be
paid off in full before you get any money from the sale. Also, credit reporting services will record the judgment so that it appears on your credit report. It will then be reported to anyone wanting to review your
credit record, such as landlords or businesses that are considering lending you money or extending you credit. A judgment remains in effect for 10 to 20 years depending on the court and it can be renewed for
additional 10 or 20 year periods.
7. WHAT CAN A JUDGMENT CREDITOR DO TO COLLECT AND WHAT ARE MY RIGHTS?
A judgement creditor is entitled to take certain actions against you to collect which were not available before. One such action is to have a summons in garnishment served
on your employer to garnish your wages. See our pamphlet on garnishments for more information. A garnishment summons can also be used to attach and freeze a bank account.
Another way a judgement creditor can attempt to collect is to ask the clerk of the court to issue an order, called a writ of fieri facias, requiring the sheriff to levy on
certain items of your property. What usually happens is that the sheriff comes to your home and makes a list of your personal property -- the property listed is considered to be levied upon. You are given a copy of
this list and you are prohibited from selling, giving away, or otherwise disposing of the property or removing it from the area until the judgment is paid off. If the creditor posts a bond with the court, he can
have the sheriff actually seize the property. If this happens, the sheriff will schedule and conduct an auction. The money from the auction will be given to the creditor to apply to the judgment balance (after the
sheriff takes his auction fee off the top); if the judgment is paid off and there any money left over, the judgment debtor (you) will get it.
You generally won't get any advance notice of the levy, but you will get advance notice of the auction. There are various grounds on which you can get the levy quashed
(that is, dissolved) and your property returned to you. First of all, certain basic possessions are automatically exempt from levy and attachment under the Virginia Poor Debtor's Exemption Act. Such items include:
the family Bible; wedding and engagement rings; pets; clothes up to the value of $1,000 per person; household furnishings up to $5,000 in value per person; cooking and eating utensils; and one vehicle not exceeding
$2,000 in value per person.
INCOME AND RESOURCES EXEMPT FROM ATTACHMENT:
General Relief, Food Stamps, Temporary Assistance to Needy Families (TANF) benefits and SSI Disability cannot be garnished. VA and Social Security benefits are also exempt
from garnishment except for child support arrears or tax debts. A bank account consisting of AFDC, General Relief, Social Security, SSI, or VA payments cannot be attached provided the account does not at any time
contain money from any non-exempt source. Money from a non-exempt source can make the entire account subject to attachment.
You can protect assets which are not covered by the Poor Debtor's Exemption or some other exemption by listing them in a homestead deed and filing that deed at the Clerk's
office of the Circuit Court of the county where you live (there is a small filing fee involved). You can, in your lifetime, homestead up to $5,000 worth of property ($10,000 for a married couple). Once used, it
cannot be used again -- for example, if you file a homestead deed to protect $3,000 you have in your savings account, you will have just $2,000 remaining to protect your other assets, even after you've spent that
money. For that reason, you should not file a homestead deed in anticipation of what a judgement creditor might seize -- since you will have plenty of advance notice, wait to see what the creditor tries to attach
and then file a homestead deed as to that item before the auction date. There are some limits on your ability to use a homestead deed. You cannot use it to exempt property from the claim of a creditor who loaned you
money to buy that item. Nor can you use it to exempt property from child or spousal support claims. Also, some contracts contain provisions which purport to have you waive, or give up your right to the homestead
exemption as to that debt. Many times, those provisions are illegal and cannot be enforced, so you should contact a lawyer if you have a contract with this sort of provision.
If you can protect your property by one or more of the grounds just discussed, you should file immediately with the court for an exemption hearing. Information on how to
do that will come with the garnishment summons or writ of fieri facias. You would be smart to immediately contact a lawyer in such a situation for further information. Debtors who have no attachable property or
garnishable income are said to be judgment-proof, which means that there is nothing a creditor can take, even if he has gotten a court judgment.
8. HOW DOES A CREDITOR GET THE INFORMATION ABOUT ME HE NEEDS TO GARNISH OR ATTACH MY PROPERTY?
Often, the first thing a creditor will do after getting a judgement is serve you with creditor's interrogatories. That is a type of subpoena to appear in court to answer
questions under oath about your income, assets and finances. The creditor then uses that information to decide whether to garnish your wages, attach your bank account, etc. Since you are being subpoenaed, you must
appear in court at the date and time indicated on the summons to answer creditor's interrogatories, unlike the warrant in debt where showing up is optional, or else you will be in contempt of court and could be
jailed --not for owing someone money, but for failing to obey a subpoena.
You should dress plainly and not wear a watch or jewelry or carry any money with you when you go to court for creditor's interrogatories -- the creditor's attorney can ask
the judge to order you to turn such items over!
General District Courts generally set aside certain days for creditor's interrogatories. The names of the judgement debtors summonsed for that day are called and they are
collectively sworn in by the judge. If a judgement debtor fails to appear, the judge may set the case for another date to require the debtor to show cause why he or she should not be held in contempt, or the judge
may order a capias issued for the debtor's arrest. After being sworn in, you would be escorted to areas off the courtroom to talk with the attorneys for the creditors. The creditor's attorney will ask questions to
find out about your financial status; since you are under oath, false responses are considered perjury (that is, lying under oath). Any questions that may be reasonably expected to draw out information about the
debtor's finances are permissible and must be answered. If you feel the attorney is asking questions that go beyond your finances, you can refuse to answer them. The judge will then rule on whether the challenged
question is within the permitted scope of creditor's interrogatories and has to be answered by you. You may be able to work out a repayment agreement, but don’t be pressured into doing so. Do not sign anything
unless you are very sure about the terms -- you would be wise to have a lawyer look it over first. Once you have been summonsed for creditor's interrogatories, you cannot be summonsed again for at least six months.
Funeral Arrangements
TO THE READER: This pamphlet contains general legal information. For advice regarding your particular legal problem, you should contact an attorney.
In planning for your funeral, you should be aware of federal and state regulations governing the procedures which must be followed by the providers of funeral services.
For example, funeral providers are required to give itemized price information over the telephone and to confirm such information in writing if the consumer requests it.
Since the law requires any such written confirmation to be quite detailed, you should always request it. Because the various legal, cemetery and crematory requirements vary from case to case, the law requires
funeral providers to give you the correct information about your particular situation. For instance, contrary to what most people think, embalming is not required by law, but the funeral provider can require in
cases where embalming is not desired that the casket be kept closed. It is helpful in arranging for a funeral or planning it ahead of time to keep in mind certain information that a funeral provider will need, such
as: full name and Social Security number of deceased; date and place of birth; occupation; mother and father's names (including mother's maiden name); the place where the service is to be held; name of the
officiating minister; church affiliation, if any; cemetery plot information; pallbearers; and any military discharge information, including serial or service numbers. Having this information set aside in advance can
make things much easier later.
However, the single most important thing to remember in planning for your funeral is that you need to be a smart consumer. Remember that you are making a significant
purchase of goods and services. You do not have to purchase any goods or services that you do not want, whether you are planning and purchasing in advance or making funeral arrangements at the time of need.
Consumers can direct questions or complaints to the Board of Funeral Directors and Embalmers, either by writing them at 6606 West Broad Street, Fourth Floor, Richmond, Virginia 23230-1717, or by calling them at
(804) 662-9907.
In planning your funeral, it is also important to be knowledgeable about benefits which may be available. The Social Security Administration should be contacted by your
Executor or heirs as soon as possible to inquire about such benefits as: (1) lump sum death benefit payments to the surviving spouse; (2) life pensions for widows aged 60 or over; (3) pensions for widows of any age
with dependent children; (4) support payments for minor children; or (5) Medicare. Social Security stops when the recipient dies, so checks should be returned to the local Social Security office or to the return
address on the envelope along with a brief letter of explanation. Be sure that you make a photocopy of the check and your letter before sending it back in case there is any question about it later. If the deceased
recipient had been receiving checks by direct deposit, the bank should be promptly notified.
Executors or heirs should also make inquiries with the Veteran's Administration if the decedent was a member of the military at the time of death or had been honorably
discharged from the military. Benefits to ask about include: (1) pensions for widows or minor children; (2) burial at National Cemetery; (3) burial flag to drape the casket; and (4) grave markers. You can get
further information on these services from the Virginia Department of Veteran's Affairs by either writing them at 807 East Broad Street, Richmond, Virginia 23219 or calling them at (804) 786-2261.
Door-to-Door and Telephone Sales
TO THE READER: This pamphlet contains general legal information. For advice regarding your particular legal problem, you should contact an attorney.
Say a salesman comes to your door offering a complete set of garden tools for the one time only bargain price of $300. You are not sure, but the salesman is so persuasive
that you end up giving him $50 that day and signing an agreement to pay off the $250 balance plus interest in monthly installments. That evening, you see ads in the newspaper for the same set of garden tools selling
for only $99. The fine print of your contract says all sales are final. Is there anything you can do to get out of the deal?
YES. If someone tries to sell or lease goods or services to you at your home, either in person or over the telephone, and you agree then and there to the sale, Virginia law
allows you to cancel the sale or lease for any reason until midnight of the third business day after the date you signed an agreement or offer to purchase.
To cancel within the three-business-day deadline, you must give notice in writing to the seller at the address stated in the sales agreement. All you have to do in that
notice is make it clear that you no longer wish to be bound by the transaction. If you are mailing this notice to the seller, the notice is considered given at the time you drop it in the mailbox with the proper
address and postage. While law does not require it, it would be a good idea to mail your cancellation by registered mail so you can later prove you mailed it within the deadline if necessary.
The seller is required to provide you with a receipt in the case of a cash or credit card sale, or a copy of the signed agreement if you are paying for the transaction in
installments (that is, a credit sale). The statement of your right to cancel must be printed conspicuously on the receipt or the agreement. If you are not given a receipt or copy of the agreement or if these do not
state your right to cancel, then you can cancel by notifying the seller in any manner and by any means without regard to the three-day deadline. If the seller did not immediately identify himself as a seller or if
he represented that his purpose was something other than selling, then you would have thirty days to cancel.
Once you cancel, the seller has ten days to return any payments you made and any note or other evidence that you might owe him anything. After this is done, you must
return any goods which had been delivered to you, except that you can require the seller to come to your house to get them. If the seller fails to demand those goods within 20 days of cancellation, they become yours
with no further obligation to pay.
You would not be able to cancel a sale only if: (1) you had asked the seller in writing to provide the goods without delay due to an emergency; (2) the seller has already
started in good faith to perform his end of the bargain; and (3) the goods could not be returned to the seller in as good a condition as received. Also, these rules do not apply to cash sales of $25 or less, to the
sale or lease of farm equipment, to sales made pursuant to a preexisting revolving charge account, or to sales where there had been prior negotiations between you and the seller.
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