Widespread changes in consumer
bankruptcy law took effect on October 17, 2005, with passage
of the Bankruptcy Abuse Prevention and Consumer
Protection Act of 2005.
Referred to as the "New Bankruptcy Law",
the Act of Congress attempts to make it more difficult for consumers
to discharge debt under Chapter 7; some of these consumers may
instead utilize Chapter 13.
The latest changes to bankruptcy law may be making it harder
for some people to file bankruptcy.
Under the new rules, the first step in figuring out whether you
can file for Chapter 7 bankruptcy is to measure
your "current
monthly income" against the median income for a household
of your size in your state.
Although the BAPCPA was intended to make it
more difficult for debtors to file a Chapter 7 Bankruptcy, under
which most debts are forgiven (or discharged), and instead force
debtors to file a Chapter 13 Bankruptcy, under which debts are
repaid under a plan, the Act has not been effective in practice.
RESOURCES: New Bankruptcy Laws
United States Bankruptcy Courts
U.S. Courts: Periodicals: Bankruptcy Basics
Cornell University Law School: Bankruptcy Overview - Legal Information Institute
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Personal Finance
Money Tip: Know your rights as a debtor. The Federal Trade
Commission (FTC) is an excellent resource both to help
you manage your debts and provide you with valuable information. |
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