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Wednesday, February 4, 2009
The recent bankruptcy law has brought some changes with it, and many people are under the false impression that they can no longer file for bankruptcy. Many of the people who need it the most wrongly assume that bankruptcy is no longer a viable option for them.
While there have been changes made in recent years, bankruptcy is still a viable option that you should consider with your attorney. While it isn't for everyone, bankruptcy might be the best option for you depending on your circumstances.
The reason that many people are confused about the current state of the bankruptcy code is that Congress passed a new law in the year 2005. This new law is extraordinarily complicated, and even lawyers may have difficulty sorting through all the details and restrictions.
However, this doesn't mean that you can no longer declare bankruptcy. There are some additional hurdles to go through, but it probably is still an option for you. The main provision of the new bankruptcy law has to do with something called the means test. Basically, you have to prove that you really are not able to pay for your debts with your current income.
Actually, if your income is lower than the median salary in your state, the bankruptcy means test doesn't even apply to you. However, if your income is higher, you may have to go through this annoying but necessary procedure to show the court that you do need bankruptcy.
If you do have to go through the means test, that means that you'll have to go to greater lengths to document your income (as well as your expenses). You must be very careful in putting together these documents, because any errors can create a world of hassle for you down the road.
Your lawyer should be able to help you with specifics, but it can be quite a tedious process. Going through this without a lawyer is not an option, especially with the latest changes in the bankruptcy code. The new law simply makes things too complex for the average person.
Of course, it helps to be as informed as possible before going to visit any lawyer. Reading more articles like this one will help you make a more informed choice and will help your visit with a lawyer go more smoothly. This can even end up being less work for the lawyer, which means a lower cost for you.
While there have been changes made in recent years, bankruptcy is still a viable option that you should consider with your attorney. While it isn't for everyone, bankruptcy might be the best option for you depending on your circumstances.
The reason that many people are confused about the current state of the bankruptcy code is that Congress passed a new law in the year 2005. This new law is extraordinarily complicated, and even lawyers may have difficulty sorting through all the details and restrictions.
However, this doesn't mean that you can no longer declare bankruptcy. There are some additional hurdles to go through, but it probably is still an option for you. The main provision of the new bankruptcy law has to do with something called the means test. Basically, you have to prove that you really are not able to pay for your debts with your current income.
Actually, if your income is lower than the median salary in your state, the bankruptcy means test doesn't even apply to you. However, if your income is higher, you may have to go through this annoying but necessary procedure to show the court that you do need bankruptcy.
If you do have to go through the means test, that means that you'll have to go to greater lengths to document your income (as well as your expenses). You must be very careful in putting together these documents, because any errors can create a world of hassle for you down the road.
Your lawyer should be able to help you with specifics, but it can be quite a tedious process. Going through this without a lawyer is not an option, especially with the latest changes in the bankruptcy code. The new law simply makes things too complex for the average person.
Of course, it helps to be as informed as possible before going to visit any lawyer. Reading more articles like this one will help you make a more informed choice and will help your visit with a lawyer go more smoothly. This can even end up being less work for the lawyer, which means a lower cost for you.
About the Author:
Don't let the fear of your debt take over your life. Get the facts about bankruptcy and learn how to get control of your debt. To learn more about life after chapter 7 bankruptcy visit us at http://personalbankruptcyquestions.org
posted by Credit Counseling at
5:13 AM
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