ArticlesReader.com Menu

Newest Articles
Most Viewed Articles
ArticlesReader.com RSS
Submit Article
Login
Signup

Search the articles

Articles Main Categories

Advice
Animals
Automobiles
Business
Career
Communications
Computer Programming
Computers
Entertainment
Environment
Family
Fashion
Finance
Food
Health & Medical
Home & Garden
Humor
Internet Business
Internet Marketing
Legal
Leisure & Recreation
Marketing
Other
Politics
Reference & Education
Religion
Self Improvement
Sports
Technology & Science
Travel
Writing

Subscribe

Receive alert message from us when new articles submitted to our site for free.

Syndicate

Related Products

Home::Finance

Are New Bankruptcy Laws Going To Help You?

Author : Frank Hague -

There are 2 sides to the changes in bankruptcy rules. It will be a lot harder to file bankruptcy under chapter 7 and get a totally clean slate.

For businesses, relying on issuing credit, the new personal bankruptcy law is doing great, reducing personal bankruptcy claims from the thousands to double digits.(In the short run).

However, lawyers working with the actual people filing for bankruptcy say that the new law is seriously flawed because it puts more financial burdens on already broke clients and reduces potential debt repayment to small businesses.

And then of course you have the credit card companies charging high interest rates which in quite a few cases caused the bankruptcy in the first place.

According to some financial specialists, much of the debt people accumulate is a result of keeping up with the Joneses and not thinking ahead.

For 80% of clients counseled each month, the debt is credit card related and averages $32,000 - a result of six to eight cards. Consumer credit organizations say the new law provides debt-reducing strategies for those considering filing bankruptcy and curbs abuse.

Under the new law it has become a requirement that the person filing bankruptcy obtains credit counseling both before and after filing for which that person will be charged..

So now the consumer would then know the advantages and disadvantages of declaring bankruptcy. Yet it seems merely another expense for an already financially stressed individual.

People filing bankruptcy in general are not overspenders, but merely faced with temporary financial disasters such as medical costs, layoffs, a divorce, gambling debts or other crises. Before you can file bankruptcy,you are now required to complete credit counseling with an agency approved by the U.S. Trustees office.

This credit counseling is designed to help you determine whether or not bankruptcy is appropriate.

Once you complete your bankruptcy, the law requires you to attend another credit counseling session.

These are new requirements, before this law was passed the law did not require a person to go through counseling either before or after the filing of bankruptcy.

Second, under the old law, a person could decide to file under Chapter 7 or Chapter 13. Under the new law, the court will look at your monthly income and apply a means test relating to the state in which you live. If your income is less than or equal to the medium income then you will be allowed to file Chapter 7 which in effect will give you a clean slate.

This medium income can vary from $28,000 in Missouri to $56,000 in Alaska. If your income is greater, you may be forced to file Chapter 13 unless you can demonstrate you do not have enough disposable income.

Under Chapter 13 you will not get a clean slate but will have to make payments on your debts.

Also, your attorney now has to personally certify that your bankruptcy filing is accurate. This means more work for the attorney, with higher legal fees.

Advantages of declaring Bankruptcy:

Legal protection from creditors

Takes care of all or most debt

In some cases, can keep home and car

May stop complete financial ruin

Provides a fresh start

Disadvantages of declaring Bankruptcy:

Bad credit

May have to repay partial debt load and return collateral to creditors

May lose assets, including house and car (If the house is worth more than a certain amount).

Bankruptcy becomes public record, and

Remains on credit record for seven to 10 years

�In the past, a bankruptcy offered a fresh start for the filer,� said Columbia attorney Gwen Froeschner Hart. �The new federal legislation offers language directed at helping creditors.�

If you analyze credit card expenses for most people you'll see that they often include medical bills and day-to-day expenses for the elderly or those earning low or fixed incomes. Records show that 50% of credit card holders do not pay their full credit card bills every month.

33% of the population can't afford medical insurance so have to charge their prescription drugs.

With the recent Medicaid cuts and rigid bankruptcy legislation who knows what is going to happen to these people.

There are some who say consumers are abusing creditors. The irony is that credit card companies are begging for customers and offering large amounts of unsecured credit, yet at the same time, lobbying for stricter debt controls.

Article Source: http://www.articledashboard.com

Frank Hague is interested in anything to do with Bankruptcies

Spam emails More free articles

More related feeds

Things You Must Know Before Filing Bankruptcy — by JON ARNOLD
They will be able to help you through the process and advise you of how to file for bankruptcy and the things that you need, as well as analyzing your situation to see if another option is better for you. As new bankruptcy laws have ...

buying billions of dollars in bad mortgages
San Jose bankruptcy attorney Ike Shulman, who is also the legislative chair for the National Association of Consumer Bankruptcy Attorneys, also urged changes to bankruptcy law, arguing that judges should be allowed to reduce the amount ...

What A Good Bankruptcy Attorney Will Do For You — by JON ARNOLD
That’s right, it is no longer YOUR choice about declaring bankruptcy; the judge must approve it. This will help to determine whether you can have your debts erased through Chapter 7 of the bankruptcy laws or whether you have to enter a ...

Biden, Bankrupcy and How He Screwed the Working Man
What is “credit limbo”? Your debt is significantly larger than your assets. You either don’t have the money to declare bankruptcy or you do not want to be subject to the draconian measures of the new law. Joe Biden, bankruptcy. ...

Douglas Rushkoff -
The credit industry went ahead and lobbied Washington to change the bankruptcy laws. While corporations could claim bankruptcy and stop paying for their retirees’ health coverage, individuals would no longer be able to claim bankruptcy, ...

New York Bankruptcy
The bankruptcy laws have been designed to help people address their financial difficulties in an honest, straightforward manner. And therefore, you just need a genuine, and trust-worthy attorney like Mr. Richard S. ...

Is Bankruptcy the Right Thing for Your Family?
In a nutshell, bankruptcy won’t put more income in your life. If your problem is really one of not making enough money to support the lifestyle you lead, then bankruptcy isn’t going to help with that. You’ll have to either ratchet down ...

File Bankruptcy Online
You can also hire a paralegal or bankruptcy attorney to help prepare forms or represent you in court. Afterwards, all documents must be filed with your local bankruptcy court. The new bankruptcy laws implemented in 2005 have made filing ...

MANCOW AT LARGE - How Much Did You Say That Cost?
People, you gotta look at the final cost of everything. Then there are the hidden charges and the brand-new impossible bankruptcy laws. We’ve all seen those ads featuring people in a shopping frenzy, having a ball until some loser stops ...

Election Issues: It’s the economy again, stupid
And speaking of arrangements that rape ordinary citizens, Obama wants to change bankruptcy laws that force homeowners to stick to the original terms of their mortgages even if the loan was predatory. Gee, it’s as if the banking industry ...

Are New Bankruptcy Laws Going To Help You?

Related articles