July 16th, 2009 at 02:52pm
Under Discrimination Law
It is imperative that both the debtors and creditors should be aware of the new bankruptcy laws so that they can save themselves from any unwanted future mishap. The U.S. Congress has made enormous changes that came into existence from October 2005.
There are some facts that are related to bankruptcy which are the main causes that bankruptcy law needed to be changed. Some of the facts are:
The filing of bankruptcy has just increased twice in the year 1995-2004 and the credit card companies were earning tripled profits. Approx. 80% of the people above the age of 60 had lost their job due to bankruptcy. Last but not the least, the filers of bankruptcy had the median income of $28,000.
Now let’s go through with the new changes in the bankruptcy law. If you are filing for bankruptcy, then the bankruptcy court can ask you to go through the Means Test first. On the basis of your result only, the court will conclude which bankruptcy will suit your case the most. As per the test, it will be assessed that how much money you are holding after paying off the necessary expenses. If your money is less than the median monthly income of the state, then you are qualified for the Chapter 7 bankruptcy. On the other hand, if your money is more than the median monthly income of the state, then court will ask you to file for Chapter 13 bankruptcy. The unfortunate part is that the day to day necessary expenses will be decided by the IRS instead of you. The court and IRS will allow you minimum allowable expense only.
These above bankruptcy laws will be a great help to you before filing bankruptcy so that you can estimate which chapter is best for you.
Richard Mathew is a freelance writer and is writing articles from couple of years. He wrote articles on finance and other topics. He want to share knowledge about various financial aspects and also want people to gain benefit from it. He is currently writing for many sites like
www.bankruptcyinfo.org.uk ,
www.creditcarddebthelp.me.uk and more…..
By Law Article
July 16th, 2009 at 08:53am
Under Discrimination Law
Bankruptcy is a legal procedure in which people or businesses that are not in a position to pay their debts are dealt with. Creditors will normally file petition against individuals or businesses that are not in a position to pay their debts after a long period of time. Debtors are normally given a chance to appeal against the petition filed against them for their failure to pay their debt. There are times when the debtors are not in a position to pay their debts as they fall due. In this case the bankruptcy law comes in handy. This law allows the debtor to divide his assets among the creditors as a way of settling the debt. This is done under the supervision of trustees who review the debtors petitions and also have the responsibility of overseeing the pay plan in the debt recovery process.In the United States of America, the bankruptcy laws are supervised in the courts in a special procedure. However with time this may not be so. The law has taken a new path meaning it will no longer be as easy for new filers to file a petition against debtors as it has been. In the past, debtors were allowed to pay their creditors as they earn, but the new law may make this impossible.There will be a procedure where the debtors will be required to go through counseling in matters to do with handling cash and on how to manage debt. It is only after the completion of this that one’s debt can be forgiven accordingly. In the old rule, one was able to choose the best way to deal with their financial situation.
Peter Gitundu Researches and Reports on Bankruptcy. For More Information On Bankruptcy Law, Read More Of His Articles Here
BANKRUPTCY LAWYou Can Also Add Your Views About Bankruptcy Law On His Blog Here
BANKRUPTCY LAW
By Law Article
July 15th, 2009 at 02:57pm
Under Consumer Law
When an individual consumer, not a business or corporation, is looking to file for bankruptcy, it is almost always most appropriate for them to either file under Chapter 7 bankruptcy law or Chapter 13 bankruptcy law. The majority of consumer bankruptcies are filed under Chapter 7. In Chapter 7 bankruptcy, the consumer is able to get rid of almost all his debts, thereby providing them with the chance to start over again, where their focus would be on rebuilding their severely tarnished credit report.
That last sentence is important to realize for anyone considering filing bankruptcy under any chapter or code. If your bankruptcy is approved by the federal bankruptcy courts after an extensively and detailed look at your current financial situation, the bankruptcy will be highlighted and readily visible on your credit report from each of the major credit bureaus for the next seven to ten years. This is a big reason why it is important to consider the act of bankruptcy as a last resort option, where you have thoroughly examined and evaluated each of your bankruptcy alternatives and found that proceeding with the bankruptcy petition is really your best option in your circumstances.
Even with the drastic changes in the bankruptcy laws in recent years, it should be noted that the underlying PUPOSE of filing Chapter 7 bankruptcy has not changed. But with that said, be aware that the changes in the bankruptcy laws have significantly changed the method and procedure for doing any kind of bankruptcy, including Chapter 7.
For the consumer considering chapter 7 bankruptcy, this is most often caused by a huge pile of debt, usually credit card debt and usually with high interest rates, where the consumer is unable to pay even the minimum amount due each month. Note that “fault” is not assigned in a bankruptcy hearing. The financial situation of the consumer may have come about due to things out of the control of the consumer, not due to the financial mismanagement of the consumer. The most frequent causes that lead up to this situation are a job layoff, high unexpected medical expenses that are not covered under one’s health insurance plan, a hotly contested divorce settlement, and too many other things which are out of the consumer’s direct control to list here.
This can be a problem. Most consumers really want to pay off their debt if they had the ability to do so. But a consumer with, for example, $60,000 or more in debt could find themselves continuing to pay on that debt for the next 20 years or more, even if they did not acquire additional debt and even at low or no interest rate being assessed.
After the bankruptcy petition is filed, the consumer needs to show up in court on a specified date, a date of which all his creditors have been notified of, and each side presents their case. The creditors, if they show up (they often do not) may argue that money was loaned to the consumer with fair expectations of repayment. It is ultimately up to the bankruptcy judge to decide how to proceed, and there is not a set or established standard for how this plays out, since each individual case is different.
Although Chapter 7 bankruptcy could conceivably be done without a bankruptcy lawyer, this is strongly not recommended. With the changes in the bankruptcy laws, compounded with variations of the law from state to state, the consumer could find himself spending more time and money that what the lawyer fees would have come to, and it is almost always worth the investment in a bankruptcy lawyer to guide you through the process, since they have a very thorough understanding of bankruptcy law and what the variations are in your state.
By Law Article
July 15th, 2009 at 02:52pm
Under Discrimination Law
It is always a matter of importance to keep ourselves updated with the current development and happenings that go on around us. It is especially crucial to be aware of the changing laws because you never know when you might need to face it. This is one fact that we cannot emphasize enough. Approaches to dealing with bankruptcy are guided by a number of laws. At one point or another in your business venture when you find yourself in this situation, it will require you to verse yourself well with the truths concerning the legal procedures that you should undertake as far as paying your debtors is concerned.Currently, there have been changing sections of the bankruptcy laws and they may not be as you used to know them previously. Many of the changing laws will make it a bit harder to prove your need for filing insolvency and in addition if you manage this stage, the process might take longer than expected for it to go through.Other aspects of the laws that are prone to change are the fees payable to the attorneys. It is likely that the fees will go up by up to 100 percent. The different chapters of the law will also be revised especially chapter 7 and 13. Once this takes effect, many debtors will be forced to file under chapter 13, which will see to it that debt cancellation will almost be impossible. This will prove to be much tougher on many debtors, who would otherwise prefer chapter 7 since it gives room for debt cancellation. For more information please keep yourself updated by visiting the bankruptcy law web pages.
Peter Gitundu Researches and Reports on Bankruptcy. For More Information On New Bankruptcy Laws, Read More Of His Articles Here
BANKRUPTCY LAWS
By Law Article
July 15th, 2009 at 08:53am
Under Discrimination Law
Someone said that the only permanent thing in the world is change itself. For this reason, we do not expect anything to last forever as it is today. What more do we need to be told? With this fact on the table, isn’t it true that we need to keep ourselves updated about the changing legislation, laws and regulations that govern our lives and our businesses?Are you a business person who has had to file for bankruptcy before, simply because you had more debts than assets and you could not manage to pay your debtors? Do you still recall what the law required of you and what the different chapters of the same required of you? Well then, all that might be changing now.There are new bankruptcy laws that are now in use and you need to familiarize yourself with them, just incase you might find yourself in this sticky situation, or you might know someone who is going through the same. Just to mention a few of the changing rules, in the old law, if you filed under chapter 13, it was easy to determine for yourself what you would be paying to your creditors on a monthly basis but that will no longer be possible.In the new bankruptcy law, the IRS will be involved in determining what you are worth per month after deductions of your basic needs of food, clothing and rent and the remaining amount will be divided in certain proportions to your creditors. Life will be a lot harder for debtors under this new law, but when the going gets tough, the tough get going.
Peter Gitundu Researches and Reports on Bankruptcy. For More Information On New Bankruptcy Laws, Read More Of His Articles Here
NEW BANKRUPTCY LAWS
By Law Article
July 12th, 2009 at 02:53am
Under Discrimination Law
Bankruptcy law provides for a plan that allows a debtor who is unable to pay his creditors to resolve his debts through the division of his assets among his creditors. This also allows the interest of all creditors to be treated with equality. Certain bankruptcy laws allow a debtor to continue his business and use the revenue generated to pay off the debts. An additional aim of bankruptcy law is to allow certain debtors to liberate themselves of the financial obligations they have accumulated after the division of their assets. Bankruptcy law includes comprehensive access to civil litigation, credit, consumer law and commercial transactions.
Bankruptcy cases are either voluntary or involuntary. Voluntary bankruptcy cases involve debtors petitioning the bankruptcy courts. In involuntary bankruptcy, creditors rather than the debtors file the petition. Voluntary bankruptcy cases are majority whereas involuntary cases are rare except occasionally in business settings to force a company into bankruptcy so that creditors can enforce their rights.
Bankruptcy law prohibits some filers with higher income from using chapter 7. To file for chapter 7 current monthly incomes against median income is measured. If it is less than or equal to median income, chapter 7 can be filed. If it is more, the ‘means’ test must be passed to file for chapter 7 which is the requirement of the new bankruptcy law.
The purpose of the ‘means’ test is to find out certain allowed expenses and debt payments are subtracted from the current monthly income. f the balance is below a certain amount chapter 7 can be filed. Bankruptcy law can be broadly classified as follows:
Co-operative bankruptcy is filing of chapter 7 or chapter 11 by co-operations and partnerships in which the trustee appointed by the court sells the assets and distributes the proceeds to the creditors. The trustee’s commission, priority debts and debts to unsecured creditors are paid on a pro rata basis.
In chapter 7, the debtor’s business operations cease once the case is filed. On the other hand in chapter 11 the business typically remains in operation and the debtor is given the same right as a trustee.
Personal bankruptcy is commenced by an individual filing chapter 7, 11, 12or 13. The debtor is allowed to exempt certain property (household furniture, jewellery, clothing, pensions, insurance policies and other assets) from liquidation by the trustee. Exemptions vary from State to State. The automatic stay takes effect immediately upon the filing, which prohibits collecting money, or taking property from the debtors. It usually remains in effect through out the case.
In chapter 7 bankruptcies, the debtor files a petition with the court with detailed financial information about his assets, debts and income. These papers are executed under penalty of perjury, the duration being three to four months. Chapter 11 bankruptcies are a reorganization procedure used by business partnership and co-operations. In this case, the debtor will act on his own as a trustee and is called a debtor ‘in possession.’
As a general proposition, bankruptcy laws state that older income taxes (more than three years old) can be wiped out in bankruptcy, but not the new incomes taxes. Prior to filing bankruptcy, the debtor should have his own particular tax situation assessed. As a general rule, debtors filing bankruptcy continue to complete their own returns and pay their own post-bankruptcy taxes.
By Law Article