Bankruptcy New Laws

Code of Bankruptcy, New Laws and Reform

President Bush signed the new bill for the Code of Bankruptcy. New laws were highly promoted by credit card companies and other major financial institutions, while consumer advocates and the recommendations of the courts were largely ignored. In the past, over 70% of all individuals who filed chose Chapter 7. After reform, qualifying for Chapter 7 has become more difficult, and in turn, credit card companies alone are expected to gain a One Billion dollar annual windfall as a direct result of these changes.

Coping with changes in the law

As with any new law, legislators rarely anticipate all possible circumstances. The potential for overlapping conflict between new provisions assures judges and appellate courts must actively interpret legislative intent and find workable solutions. As bodies of judicial opinions grow, both new opportunities and burdens continue to expand. For individual filers, traversing these new laws is now more difficult, but does not present an insurmountable challenge. With the assistance of a capable attorney who is well versed in recent changes, over 85% of all people who file are still expected to qualify for Chapter 7.

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