(PRWEB) August 30, 2005
The Bankruptcy Site (http://www.thebankruptcysite.com)] offers consumers assistance in combating overwhelming debt. Developed with the assistance of Joseph C. McDaniel as a means for providing accurate and up-to-date information on filing bankruptcy, the site has grown to include bankruptcy alternatives and recovery information. Personal bankruptcy filers still make up the majority of the site's users.
Chapter 7 bankruptcy is the most common type of bankruptcy to file. This is due largely to the fact that once it has been filed, your accrued debt is completely erased - typically within a few months. With chapter 7, your slate is wiped clean, those pesky creditors get nothing and you are given another chance to have the type of credit and financial success you had always hoped for.
This will all change on October 17th, 2005 when a new bankruptcy law goes into effect that will make it harder for individuals to clear their debts by filing chapter 7 bankruptcy. Right now, the court is the one that determines if you are eligible to file, but, in less than two months, your income will be put through a two-part means test. Your expenses will be calculated to see if you can afford to pay 25% of your non-priority unsecured debt and then your yearly income will be matched up against your state's average income. If your income is even a percent above your state's - your request to file chapter seven bankruptcy will be denied.
Keep in mind that even if your income does fall below your state's median, you could still be forced into filing chapter 13 bankruptcy if you are able to pay 25 percent of your unsecured debt.
You will find that along with having to meet tougher income requirements, the new bankruptcy law will be tougher on homestead exemptions as well. As it is right now, if you declare bankruptcy, the state in which you live and file might allow you to protect your home equity from creditors. Under the new bankruptcy law, homestead exemptions will become more and more rare - leaving individuals vulnerable to severe home equity loss.
Planning on using the services of a bankruptcy attorney? Better get started now. Once the new law goes into effect, bankruptcy attorneys will be less and less eager to file - all thanks to the increased liability they are subject to under the new law. If any facts or information about a client's case were to be deemed false - the bankruptcy lawyer could be fined extravagant fees and fines.
What does all of this mean to you? Well, after October 17th, 2005, it will be much harder for an individual to file chapter 7 bankruptcy without a bankruptcy attorney due to the newly complicated procedure. Trying to find that bankruptcy lawyer to work with will be an even harder task and even if you do find one, getting accepted for chapter seven could be close to impossible. Chances are, you will be forced into filing chapter 13 bankruptcy - not quite the fresh new start you were hoping for.
The good news is that there is still time to act before the new law goes into effect. You can still file chapter 7 bankruptcy- if you start the proceedings now. To help speed up the process, enlist the services of a good bankruptcy lawyer and get the ball rolling before it's too late.
For additional information on the new bankruptcy law, filing bankruptcy, or recovering from bankruptcy, visit http://www.thebankruptcysite.com.
About The Bankruptcy Site:
Since 2001, The Bankruptcy Site has been providing free information about filing bankruptcy, recovering from bankruptcy, bankruptcy lawyers, and bankruptcy exemptions. Originally started as a means for providing information to those who have had financial hardships, the site has grown to be one of the most respected personal bankruptcy resources.
The Bankruptcy Site
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