Articles For Knowledge Sharing »
Business-management »
Finance-management »
Bankruptcy » New Bankruptcy Law Explained
New Bankruptcy Law Explained
On October 17, 2005, new bankruptcy law went into effect, changing the process of filing for bankruptcy throughout the United States. This new shift in law requires additional steps to be taken by the attorney and the debtor but has been geared toward benefiting the debtor. The following details explain the changes in the law and how they will affect anyone considering bankruptcy.
andnbsp;
Documentation andnbsp;
The documentation required for filing for bankruptcy has been increased, asking the debtor to provide additional information thoroughly detailing all of their income and expenses. If expenses exceed the IRS allowance, a andlsquo;special circumstancesandrsquo; document must be submitted explaining the reasons for the extra expenses. A statement of accuracy must also be submitted with the special circumstances document. The additional documentation makes the task of filing take more time but provides more accuracy to a debtorandrsquo;s financial dilemma. This could result in more debt relief.
andnbsp;
Counseling
In an attempt to decrease the number of people filing for bankruptcy, the new law requires that debtors receive counseling from an approved credit counseling agency within six months prior to filing for bankruptcy. The purpose of the counseling is to ensure that people are not making an uninformed decision to file for bankruptcy. It is also the hope of the court that counseling will provide alternative options for those who truly donandrsquo;t need to file.
andnbsp;
The Means Test
Before the new law, consultations with an attorney would allow the client to choose what type of bankruptcy they felt suited them best. However, the new law is framed to reduce the number of Chapter 7 filings by only allowing people who fall under their median state income, adjusted for family size and inflation, and people who meet rigorous standards under the means test to file for it. The rest of the people who donandrsquo;t meet these standards must be evaluated by a series of complex, mathematical formulas that change annually to match new median incomes and expense standards. Clients who do not qualify through the means test will be required to file for Chapter 13 bankruptcy. The new law also extended the Chapter 13 term from a three- to five-year term, to a mandatory five-year term. Throughout the mandatory five-year term, the client must be supervised and represented before they can receive their discharge.
andnbsp;
The effects of the new law make the process of filing for bankruptcy more complex, requiring attorneys to specialize in bankruptcy law. To completely understand how the new bankruptcy laws in your state can impact your debt and affect your life, speak with a local bankruptcy lawyer.
andnbsp;
If you are seriously considering bankruptcy and you live in Los Angeles, you need to consult with an attorney who understands California bankruptcy laws. Not all bankruptcy attorneys are the same. While the process appears complicated, a Los Angeles bankruptcy attorney will be able to help you understand your options and avoid making bad decisions. You get one chance to file bankruptcy right the first time. The California bankruptcy attorneys at Borowitz, Lozano andamp; Clark know what theyandrsquo;re doing, because bankruptcy is all they do. Unlike many firms, they never leave a paralegal or secretary in charge of a case. Thatandrsquo;s why their cases succeed at such a high rateandmdash;even higher than many other bankruptcy firms. For a free consultation, contact a qualified Los Angeles bankruptcy attorney from BLC Law toll-free at 800-509-3200, or visitandnbsp;www.blclaw.com.
Article Source:
Articles For Knowledge Sharing
About the Author
Brian Reed. California bankruptcy attorneys If you're filing for bankruptcy in Los Angeles, California, contact the law office of Borowitz, Lozano & Clark, experienced bankruptcy attorneys who take your case from start to finish.
by: Franklin
Html View | Print View
Total views: 62
Word Count: 578
Date: Fri, 18 Jun 2010 -
0 comments
Publish/Share this article
To use this article on your site
click here to get the HTML code |
Remember: The article body, title, author bio and links may not be changed or removed. By publishing this article, you agree to all the terms in our
Terms of Service.
Rating:
Not yet rated
Comments 
No comments posted.
Add Comment
You do not have permission to comment. If you
log in, you may be able to comment.
More articles in this Category
1:
The principles of bankruptcy bank accounts
2:
Obtain the Cheap Bankruptcy Lawyers While Struggling with Finance
3:
A Bankruptcy Proceeding Attorney To Your Relief
4:
Murrieta Bankruptcy Attorney
5:
This is a New Establishing - New York Bankruptcy Lawyer
6:
Palm Desert Bankruptcy Attorney
7:
Insolvency Attorney Aid In Resolving Money Difficulties
8:
Criminal Law - Legal Support
9:
How To Help Save Your Home Without Bankruptcy
10:
Current Financial ruin Rules - 3 Forms of Bankruptcy plus How They have Changed
11:
What Does It Mean To Have A Bankruptcy Discharge
12:
Tips on how to research laws on bankruptcy Arizona
13:
Bankruptcy Property Exemptions
14:
Four Questions To Ask a Bankruptcy Lawyer Before Signing
15:
Who Files Chapter 13 Bankruptcy?
16:
Debt Relief: What Are the Alternatives to Bankruptcy?
17:
Five Steps To Help Avoid Bankruptcy
18:
New Bankruptcy Law Explained
19:
Does My Chapter 13 Payment Change With My Income?
20:
Bankruptcy for Small Businesses
