New Bankruptcy Law

At one point, filing bankruptcy was extremely easy, and generally hassles free. To begin with, the new bankruptcy law was established to offer a new beginning to those who had financial difficulties. However, with the new bankruptcy law and thanks to those who abused the privilege, new bankruptcy laws are stricter and have more requirements than ever before.

Here is a look at some of the changes within the new bankruptcy law and how these changes may affect your decision to file bankruptcy.

Bankruptcy Law – Credit Counseling

Now, with the new bankruptcy laws, no matter rather you decide to file for Chapter 7 bankruptcy or Chapter 13 bankruptcy, you are now required to attend credit counseling. This must be done before you go to file for the bankruptcy, by a court approved credit counseling center.

You need to obtain a certificate and in some cases, a repayment plan. You will then have to submit all of this to the courts, as proof you have met the requirements under the new bankruptcy law.

After filing bankruptcy, you will then be required to submit a certificate showing that you have attended credit counseling, yet again, learning to manage your personal finances.

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New Bankruptcy Law – Chapter 7 Filings

The requirements for filing a Chapter 7 bankruptcy have also changed. Now, thanks to the changes in the laws, you have to prove your income. If you have a higher income than stated by the median income within your state, you will likely have to file a Chapter 13 bankruptcy instead of a Chapter 7.

You will also be required to take what is called a means test. This is used to determine rather you are capable of making repayments under a Chapter 13 repayment plan bankruptcy.

Bankruptcy Law – Chapter 13

Now, with the new bankruptcy law, you may find, if you have to file for Chapter 13 bankruptcy, that you are paying more than you can comfortably live with. There are specific guidelines to calculating how much you have in disposable income and assets. This will depend on your income for the last six months before you filed bankruptcy and not your current income.

What is more, property value will be regarded with its real value, what a store might be able to get for that property. What this means, with the new bankruptcy law, is that depreciation is taken into consideration, which will include the condition and age of the property being sold.

New Bankruptcy Law – Residency

The new changes in law require certain residency stipulations that were not required before or are stricter. You see, states have homestead exemption, meaning that certain laws apply to residence of that state. However, now with the new law, the residency requirements increase from three months to two years, before these laws can apply to filers.

It is important to understand the new bankruptcy laws and how they apply to you before you file bankruptcy in any state. Make sure you do your homework and know what is best for you before you file.

This is a page on New Nankruptcy Law

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