THE BANKRUPTCY ACT OF 2005

DebtSettlementProgram.net can provide you the necessary Chapter 7 information and introduce you to bankruptcy laws. However it is always advised to check with a bankruptcy lawyer about any new bankruptcy law that might affect you. Not only can they offer Chapter 7 bankruptcy information, but Chapter 13 information as well, and on all personal bankruptcy laws. You don’t have to be in the dark about federal bankruptcy laws.

To prevent abuse of federal bankruptcy laws, new bankruptcy laws were enacted, including the Bankruptcy Act of 2005, causing several changes to be made to the current system. The primary goal of the bankruptcy law 2005 was to make it more challenging to file for Chapter 7 protection, encouraging many individuals to seek protection under the alternative Chapter 13 repayment program. Chapter 7 bankruptcy gives debtors the opportunity to discharge all of their debts, while Chapter 13 forces debtors to repay their debts over a pre-determined payment plan.

Prior to this amendment, individuals of all income levels were eligible for Chapter 7 consideration. Now, debtors must pass a ‘means test’, reviewing their present income. In the event they don’t pass the means test, they must file for Chapter 13 protection and agree to a repayment program. Debtors with income above their state’s medium income are subject to the mean’s test.

Another significant change resulting from this act is that debtors are subject to bankruptcy reversal or prevention from approval in the event that fraud or misuse is detected. Yet another change is that a debtor must wait a period of 8 years in between filings in the event that they need to request another dismissal of their consumer debt. The previous ruling was 6 years. After the enactment of this act, petitioners for bankruptcy must participate in credit counseling sessions and must provide proof of compliance to the court.

Depending upon the individual’s state of residence, they may be granted a stay allowing them to retain their primary residence and a vehicle, providing they can provide financial proof that they can afford to continue making the required payments. There are limits to the items which are eligible for a relief of stay.

Bankruptcy Laws, New Bankruptcy Law, Chapter 7 Information, Chapter 13 Bankruptcy Law, Bankruptcy Act Of 2005, Personal Bankruptcy Law and More

The above changes represent the primary changes which affect the individual debtor, although there are a multitude of other changes which affect counsel and the process required to petition and receive a formal bankruptcy discharge. Each of these changes was intended to discourage debtors from using this financial option unless it is absolutely necessary.

A viable alternative to bankruptcy in which many debtors are utilizing is debt settlement. Debt settlement refers to the process by which the actual amount of debt is reduced, allowing the individual to make their required ongoing payments and to pay off their debts in a feasible amount of time. This process differs from debt consolidation which is the consolidation of all consumer debts into a single account, often at a reduced interest rate.

Confused by new bankruptcy laws? Have questions about Chapter 7 bankruptcy law or Chapter 13 bankruptcy law? DebtSettlementprogram.net can explain the Bankruptcy Act of 2005 and any other personal bankruptcy laws. We equip you with the necessary Chapter 7 information and chapter 13 information so you can weigh these against bankruptcy alternatives.

Debt Settlement Program is a Credit Card Debt Reduction company offering a Debt Settlement Program to Eliminate Credit Debt and Credit Debt Advice to assist you in paying off your debt.

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