property bankruptcy

Property Bankruptcy - your questions answered right here...

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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.

You are required to do credit counseling within six months of filing your bankruptcy petition. You are also required to attend money management classes at your expense before your debts are discharged. In Florida, your home would have been exempt no matter how long you lived there.

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. Under the new law, if information provided in your case is found to be inaccurate, the lawyer is subject to various fines and fees. It will be more difficult to find a lawyer willing to handle your bankruptcy because of the liability and the time and effort it takes to verify all 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. 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 lawyer 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.

More people will be forced to use chapter 13 bankruptcy under the new law. That sounds reasonable to a lot of us. 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.

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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