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The new bankruptcy law has provisions that make it harder for the people in debt to file bankruptcy.

In addition to the new credit counseling requirement for all filers and the means test for chapter 7, there are other changes in the bankruptcy laws.

You are required to do credit counseling within six months of filing your bankruptcy petition.

There are new residency requirements. Under the old bankruptcy law, the amount of equity in your house protected from creditors was set by the state where you filed. 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. It gets more complicated. Under the new law, if information provided in your case is found to be inaccurate, the attorney is subject to various fines and fees. If you can find an attorney willing to take your bankruptcy case, it is going to cost you more because of the time and effort it takes the attorney to verify your information. The president of the American Bankruptcy Institute has reported that some attorneys say they may increase their fees by 75 to 100 percent.

See 'Further Changes Brought About by the New Bankruptcy Law' for information on Chapter 13 disposable income and changes regarding personal property. There may eventually be some modifications in the law if it becomes evident it is causing more problems than it solves. It's no surprise these changes will make it harder and costlier to file bankruptcy. That meant most, if not all your personal property would fall within the exempt property categories of most states. Since you have to come up with a retail price and your attorney has to certify it's correct, you just about have to have an appraiser to the valuation.

Also, under the old bankruptcy rules, the exempt personal property you could keep under chapter 7 was determined by the laws of the state where you lived if you resided in the state for at leas three months. Otherwise you must use the exemptions of the state where you used to live. That reason behind that was to force people who could repay all or part of their debts to do so instead of using bankruptcy chapter 7 which wiped away most debts. That sounds reasonable to a lot of us. Under the old rules, you subtracted your actual expenses from your monthly income to arrive at your disposable income. Then, instead of subtracting your actual expenses, you use allowed expense amounts set by the IRS. 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.

There are a lot of changes to the bankruptcy laws. It would probably be a good idea to consult an attorney before you file.



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