What are some recent changes to bankruptcy law?
New bankruptcy laws went into effect in 2005, changing the rules substantially. Under the old rules, most filers could choose the type of bankruptcy for which they wanted to file. This allowed people with higher incomes to file for Chapter 7 bankruptcy, even when they had the means to file for Chapter 13 and pay off some of their debt. Some of the changes made to the law went into effect in order to prevent this from happening.
Following are the major changes made under this law:
- Under the new laws, fewer people are able to file for Chapter 7 bankruptcy. More file under Chapter 13.
- In the six months prior to filing for bankruptcy, you must meet with a credit counselor for a 90-minute session.
- You must attend money management classes before your debts are discharged.
- You must pass a means test in order to qualify for Chapter 7 bankruptcy.
- The court applies living standards derived by the IRS to determine how much you have available to pay for your debts for Chapter 13.
- The new laws are more stringent about homestead exemptions.
- Bankruptcy attorneys are more liable for fees and fines if a client’s case is found to be inaccurate.
Call us toll-free today at 1-800-260-1402 for your complimentary initial bankruptcy consultation or visit one of our 100 offices across the United States. You can also read our many informative articles on our website, www.maceybankruptcylaw.com. For the best advice on filing for Chapter 7 or Chapter 13 bankruptcy protection, trust the experienced and caring attorneys at Jacoby & Meyers Bankruptcy Law.