Filing Bankruptcy Bankruptcy may become a last resort option for disaster victims who cannot
satisfy their creditors. Filing bankruptcy will not necessarily cancel all debts and does not eliminate liens against property. It is recommended that individuals wishing to pursue bankruptcy proceedings be referred to a State Bar-certified lawyer referral service, such as the VBA, where an experienced bankruptcy attorney can be identified. Care should be taken when choosing a bankruptcy attorney and debtors may wish to consider whether the person is board certified or otherwise has demonstrated skill and experience in the bankruptcy field. For information about lawyer referral or assistance for for low income debtors, contact:
Vermont Volunteer Lawyers Project or 30 Elmwood Ave.
Burlington, VT 05401 1-800-639-8857
acourt@lawlinevt.org www.lawlinevt.org/vvlp
The Vermont Bar Association PO Box 100
Montpelier, VT 05601-0100 1-802-223-2020
dnicholls@vtbar.org www.vtbar.org
Disaster victims concerned about their ability to pay their mortgage arrears and/or
other debts may have questions about bankruptcy. If you have income and you want to keep your house, despite being behind in your payments, you may be able to file a chapter 13 bankruptcy. In this type of bankruptcy, the homeowner proposes a plan of how (s)he will pay regular mortgage payments and all other living expenses, and also pays an amount every month toward the mortgage arrears. If you think you may want to file a Chapter 13 bankruptcy, you should consult an attorney.
If a disaster victim is either current on his/her home mortgage or prefers to
surrender the home and is otherwise having trouble negotiating with their creditors, a Chapter 7 bankruptcy filing may be an option to assist the victim with discharging the bulk of his/her debts. Certain limits on an individual's ability to file a Chapter 7 bankruptcy took effect on October 17, 2005, most notably with respect to whether a debtor is deemed to have the means to be able to pay their debts rather than discharging them. Consultation with an attorney is highly recommended.
General information about filing for bankruptcy relief in Vermont can be found at
the Vermont Bankruptcy Court’s website under the heading “Bankruptcy Help” at
www.vtb.uscourts.gov. Other useful information about filing for bankruptcy and the income review can be found at the US Trustee Program’s website at
www.justice.gov/ust.
Credit Reporting This area of law is governed by the Federal Fair Credit Reporting Act, 15
U.S.C.A. § 1681, which requires that credit reporting agencies furnish a free copy of a consumer’s credit report upon request within 30 days after the consumer is notified of an adverse action. And as a Vermont resident, individuals are also entitled to one free credit
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