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The new bankruptcy law has provisions that make it harder for the people in debt to file bankruptcy. You probably won't lose any sleep over people who abused bankruptcy, but there are people who lose jobs or have uninsured medical expenses who the new law hurts. Most of the changes will cost you money one way or the other.

There are new residency requirements. In Florida, your home would have been exempt no matter how long you lived there. Under the new bankruptcy law, if you live in a state for less than two years and it has a better exemption than where you lived previously, you can't use the more favorable exemption. If you bought your house less than 40 months (that's three and a quarter years) before filing bankruptcy, or violated securities laws, or have been found guilty of certain criminal conduct, you can only exempt up to $125,000 regardless of a state's exemption.

If any of the requirements of the new law confuse you and you decide you need a bankruptcy lawyer, it's going to cost you more. If you can find a lawyer willing to take your bankruptcy case, it is going to cost you more because of the time and effort it takes the lawyer to verify your information.

If you do find a lawyer willing to file, it will cost you a lot more.

See 'Further Changes Brought About by the New Bankruptcy Law' for information on Chapter 13 disposable income and changes regarding personal property.

You have information about the new bankruptcy law requirements for credit counseling, the income and means tests for chapter 7, residency requirements, and lawyer liability, but there are even more changes you should know about.

If you are allowed to file Chapter 7 bankruptcy, there are changes in how your personal property is valued. Under the old law, you could value your personal property at basically 'garage sale' prices. Since you have to come up with a retail price and your lawyer has to certify it's correct, you just about have to have an appraiser to the valuation. A car is easier because you can just look up the blue book price.

Under the new law, you must live in a state for two years before filing bankruptcy in order to use the state's exemption laws.

More people will be forced to use chapter 13 bankruptcy under the new law.

Chapter 13 bankruptcy required that you devote all your disposable income to repaying debts. Under the old rules, you subtracted your actual expenses from your monthly income to arrive at your disposable income.

Under the new bankruptcy law, your monthly income is your average income for the six months before filing your petition. These amounts are often lower than your actual costs.

Under the old law, if your bankruptcy case was dismissed for any reason and you still couldn't pay your bills, it wasn't much of an issue to refile. The new law limits debt relief if you are filing after a prior case was dismissed. Even if the lawyer will not take you on as a client to file bankruptcy, they may be willing to give you legal advice.



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