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Washington, D.C., Bankruptcy Basics

If a major life event, such as a divorce or the loss of a job, has recently affected your life or you are unable to pay more than the minimum amount on your bills, bankruptcy may be a good option for you. Whether you live in Georgetown, DuPont Circle or Shaw, you may need to file for Washington, D.C, bankruptcy. And when you do, you will need to know the basics of Washington, D.C, bankruptcy law.

Bankruptcy is fairly complex process, so consider hiring a bankruptcy attorney to help you file your case in the District of Columbia bankruptcy court. Also, a bankruptcy attorney can help you understand the nuances of Washington, D.C., bankruptcy law and the various options available to you.

Types of Washington, D.C, Bankruptcy

Consumer bankruptcy is the type of bankruptcy filed by individuals. You have two options. The first is known as Chapter 7. Chapter 7, also known as liquidation, is when an individual gives up all his non-exempt assets. Non-exempt assets include such items as televisions, computers, jewelry over a certain amount and most luxury items. A court-appointed trustee then takes these assets and sells them to pay off the debtor's creditors.

Another type of consumer bankruptcy is known as Chapter 13. Chapter 13 is for those Washington, D.C. debtors who have a steady income and some disposable income they can use to pay toward their debts. Under this kind of bankruptcy, the debtor comes up with a plan to reorganize his debt and pay back his creditors over a three- to five-year period.

What Debts Does Bankruptcy Get Rid Of?

Bankruptcy can help consumers get rid of a lot of their debts, but it cannot eliminate all debt. Debts that remain after filing for bankruptcy in D.C. bankruptcy court include:

  • Most student loans
  • Your most recent back taxes
  • Alimony and child support
  • Fraudulent debts
  • Fines and penalties owed to government agencies

Washington, D.C., Bankruptcy Exemptions

Under Chapter 7, the D.C. bankruptcy court will seize all your non-exempt property and sell it to pay off your creditors. However, you are allowed to keep all exempt property. Exempt property includes such items as lost earnings payments, child support and personal injury compensation payments up to a certain monetary amount. You can choose from two exemption schemes under Washington, D.C., bankruptcy law. Each scheme lists a different amount of property you can keep if you file for bankruptcy.

The first scheme enables you to keep the following items, among others:

  • Health aids
  • Jewelry up to a certain monetary amount
  • Your home up to a certain monetary amount
  • Your car up to a certain monetary amount
  • Tools of your trade up to a certain monetary amount

Under the second scheme, you can keep the following items, among others:

  • Household goods up to a certain monetary amount
  • Professional books and tools up to a certain monetary amount
  • Your property with some limitations
  • Your car up to a certain monetary amount
  • Social Security benefits
  • Family pictures and the family library up to a certain monetary amount

Hiring a Washington, D.C., Bankruptcy Attorney

Because the process of filing for a Washington, D.C., bankruptcy is complex, you will want to rely on the professional expertise of a bankruptcy lawyer to assist you.

Ask your friends for referrals or identify attorneys using a site like Next, set up a series of consultations with several attorneys. These initial meetings are your chance to interview the attorney and see whether he is a good fit for you and your case.

At your consultation, you're assessing whether this is the lawyer you want to hire. Some of the questions you should ask the attorney include:

  • How long have you been practicing bankruptcy law in Washington, D.C.?
  • What do you think of my case? What are my options, and what are the consequences of each option?
  • What is your fee arrangement? When do you expect payment?
  • Will you be the only attorney working on my case? If I need to contact someone with a question, for whom do I ask?

Once you have gone on a number of consultations, you should be informed enough to make a decision. Remember, it is important that you find a Washington, D.C., bankruptcy attorney you can trust to handle your case competently and professionally.