• Chapter 13 bankruptcy is one of the only ways to for a consumer to keep his home when he falls behind on mortgage paymentsmoney, money, money image by easaab from Fotolia.com
  
  Bankruptcy is usually the last resort for debt-ridden consumers who feel buried under the weight of accumulated mortgage payments and other private debt. Chapter 13 bankruptcy offers a way for consumers to restructure debt and save some assets, including their home. Virginia law is very clear on the rules and guidelines for filing a Chapter 13 bankruptcy petition, however, and the state's courts reject many petitions because they are improperly filed.
  
  

Back to Back Bankruptcies

• According to the website for the Bankruptcy Law Network, a Virginia court may dismiss your chapter 13 bankruptcy petition because it falls too closely on the heels of a previously declared bankruptcy. For example, debt restructuring that occurs in a chapter 13 bankruptcy cannot be granted within six years of a successful judgment of a chapter 7 bankruptcy. The only exception to this rule applies when 100 percent of the chapter 7 debt is paid through liquidation of your assets. Even in that instance, however, the final decision is still in the hands of a judge.
  
  

Faulty Debt Management Plan

• A judge may reject your debt repayment plan at your chapter 13 bankruptcy hearing. This might happen if your proposed means of repaying your debt projects an unrealistic source of income or because your plan does not show the debt being paid off in a reasonable amount of time. A denial of your proposal will not end the bankruptcy process, however,because you will have an opportunity to regroup and present a restructured debt management plan to the court.
  
  

Trustee Recommendation

• The bankruptcy trustee in charge of restructuring debt can recommend to the court that your chapter 13 petition be dismissed. This may happen if the trustee suspects that you've misrepresented your assets and are attempting to defraud the court. This has very serious consequences for you, including contempt of court and perjury charges which could add prison time to your already dismal financial situation.
  
  

Judge's Power

• A Virginia judge has the final decision in approving or dismissing a proposed chapter 13 bankruptcy petition. He might refuse the claim for a number of reasons from failing to fill out your paperwork correctly to feeling as though you have not taken the proceedings seriously and have no real intention of following through with the payment plan to save your assets. A decision like this leaves you open for creditors to immediately file suit against you in an effort to recover money owed and move to seize assets, such as your home and business.