legal bankruptcy

Legal Bankruptcy - your questions answered right here...

More About Legal Bankruptcy...



It is almost certain that under the new law filing bankruptcy will cost more.

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.

If you have been moving around, the exemption of the state where you lived most of the time before the two-year period is used. 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 attorney, it's going to cost you more. It will be more difficult to find an attorney willing to handle your bankruptcy because of the liability and the time and effort it takes to verify all 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.

It is clear from the changes mentioned here that it's going to be more difficult and costlier to file bankruptcy no matter what chapter you use to file. There may eventually be some modifications in the law if it becomes evident it is causing more problems than it solves.

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 attorney 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. 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.

Chapter 13 bankruptcy required that you devote all your disposable income to repaying debts. That part hasn't changed, but how you calculate your disposable income has.

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. That means more chapter 13 bankruptcy plans will fail.

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



Contact |  Bookmark this page! |  Privacy |  SiteMap |  Legal Bankruptcy (Home)

copyright ©2007 bankruptcystressrelief.com
legal bankruptcy | bankruptcy fees | file chapter 7 bankruptcy | filing chapter bankruptcy

Webmasters: this website is hosted by BlueHost, web hosting for professionals, around the world.
file chapter 7 bankruptcy