Important Changes To Bankruptcy Laws

Filing for bankruptcy has always been a tedious process and many people find it overwhelming. Part of the reason for this is that people just don't know enough about the process. Over the years there have been several changes to the bankruptcy laws that can greatly affect a person's financial situation. These law changes came about in order to better protect those seeking bankruptcy protection as well as prevent abuse of the system.
Changes To Qualification Standards
In the past, qualifying for bankruptcy was, in a sense, unregulated. People were able to qualify for Chapter 7 debt elimination if it was determined that their debt burden was too large in comparison to the amount of income earned. With such loose guidelines for qualification, many people who could have afforded to repay some of their debts, were able to have their debts erased without any cost to them. Ultimately, paying off debts is the responsibility of the borrower and needing help versus a complete bailout are two completely different issues.
In 2005, the bankruptcy law changes set forth new regulations for how a filer qualifies for Chapter 7 versus a Chapter 13 repayment plan. Filers now must pass a "means test", which determines if the filers income is less than the median income in their state of residence. If the income is less than the median income of the state, the filer may file for Chapter 7; whereas, if the income is greater than the median income of the state, the filer can only qualify for Chapter 13 bankruptcy. The idea is to weed out those that have some ability to repay their debts, no matter how small a monthly payment.
Changes To Requirements
The bankruptcy process is highly structured and requires numerous steps of compliance on the part of the filer. Changes to the law now require that anyone filing for bankruptcy protection attend and complete a debtor education course. The course is a government-approved financial management program designed to teach filers about budgeting, smart money management, debt relief plans and how to use credit wisely. The idea is to provide filers the tools necessary to regain control over their finances to prevent the need for bankruptcy in the future.
Changes To The Benefits
Bankruptcy offers many benefits other than debt relief such as protection from creditors, evictions and legal actions for child support or divorce. An automatic stay is an order that prohibits creditors from contacting a filer once they have filed for bankruptcy. In the past, everyone was automatically protected under this order once they filed their petition. The new laws have restricted the automatic stay protection to that of credit collections only. Filing no longer stops evictions or legal actions for child support or divorce.
A qualified bankruptcy attorney can review the financial situation of anyone considering filing and advise them on the best way to proceed. Bankruptcy isn't always the best answer for everyone and the changes in the laws could affect the outcome of a case.

The Lee Law Firm's bankruptcy lawyers have many years of experience in all aspects of Chapter 7 and Chapter 13 Bankruptcy. They have extensive knowledge of bankruptcy laws and aim to provide their Dallas bankruptcy clients with a plan to obtain a solid financial future.

Five Things You Must Not Do When Choosing A Bankruptcy Lawyer

If you are undergoing major financial distress and you have tried out every possible debt help technique there is available, what else can you do? The only answer left to resolve your problems is by declaring bankruptcy. Bankruptcy is not advised by many financial experts. But, when all else fails and you have no other option left then it is the right time to exercise the method. To make the complicated process less stressful, bankruptcy lawyers are available to help you out.
A bankruptcy lawyer is a professional individual who specializes in the bankruptcy field. It is someone who is an expert and knows every single minor and major detail that is included in the process. This is an attorney who can represent you in the judicial court to make filing for bankruptcy short and fast. At the same time, bankruptcy lawyers guide you towards bettering your finances, they help you pull up yourself and start fresh.
What Not to Do When Finding A Bankruptcy Lawyer
When choosing a bankruptcy lawyer, there are things that you need to watch out for, traits and skills that you must consider. However, there are also factors that you need not look for and you should not do in your search of a bankruptcy attorney. The following are:
Decide On The Last Minute
Most often, debtors tend to put off filing for bankruptcy. Even more, they neglect choosing a bankruptcy lawyer ahead of time. Save yourself from despair by not joining the pack. Delaying your search for professional aid will only make matters worse. Finding an attorney on the last-minute does not help your case at all. The longer you wait, the more your debts will increase and pile up and your attorney will not be able to prepare your case well putting you in the losing end. Finding a good and reliable bankruptcy attorneys' take time.
Demand For A Low Service Fee
Face it, you are going through the most complex debt elimination method and it is just right that you pay your bankruptcy lawyer the best price possible. When you are finding for a bankruptcy attorney to work for you, never negotiate with his service's cost as this will surely scare him out. You can settle for rate that both suits you perfectly during the start of the bankruptcy process, but never demand. The process of bankruptcy is not easy at all so expect the attorney's fee to be expensive. The safest way to go is for you to scour as many bankruptcy lawyers as possible in order to compare rates. If you are truly short on cash, choose the professional with the lowest asking rate but see to it that he is eligible.
Delay Examining Credentials
There are a lot of scammers out there just waiting for you to fall into their trap. In order to avoid making the scenario worse, for every bankruptcy attorney on your list ask them to present their credentials to you. Accreditation's, extra training sessions completed, papers, and other legal documents must be shown to you first hand. Also, make sure that the lawyer is certified by the American Bankruptcy Institute. Verify with the board or with the company he works for to check if all the information given is correct and valid.
Not Asking Questions
While you are choosing a bankruptcy lawyer to make the task easier for you and eliminate the stress it gives you, it is not also right to not ask questions to your attorney. Believing what comes out of their mouth instantly puts you into more danger. Ask basic questions. How many bankruptcy cases has he handled and closed successfully? How does the process work? How long will it last? What goes on in the court? Will you work openly with the bankruptcy lawyer or not? What services do you offer aside from bankruptcy?
Overlook Reactions
Once you have finished making interviews with prospective bankruptcy attorneys evaluate how each one responded on your questions. If someone gives you elusive answers or is not clear in pointing out his services then its best to eliminate them from your list. Another factor to watch for is your feeling towards the lawyer. Always select the bankruptcy lawyer whom you feel most comfortable with. He is going to handle your case and you are going to work with him so might as well hire someone you feel at ease with and with good rapport.

Post-Bankruptcy Loans: What You Need to Know After Filing

Many of us are aware that bankruptcy is a last-resort strategy if you are in financial trouble. Besides the immense headache that the court process can cause, filing for bankruptcy leaves a stain on your credit that will never go away. While there is a real benefit from having all your past debt erased from your credit history and starting new, the effects and pains of bankruptcy will never really go away.
In an effort to restart your life post-bankruptcy, however, there are options. Due to your clean record in terms of debt, once you are able to find a job and a steady means of income there are lenders who will be more than happy to serve you. There are plenty of opportunities to receive post-bankruptcy loans in today's financial market as long as you know where to look.
Your New Appeal to Lenders
The idea of a lender actually wanting to serve someone post-bankruptcy may at first seem absurd. However, there are a few key factors to your life now that, from the lender's perspective, actually make you a desirable client. Therefore, many lenders will actually specialize in granting post-bankruptcy loans.
Consider the following facts of your situation after filing for bankruptcy:
1) You have limited or no other debts. With the exception of a few key areas (taxes, school loans, and child/spousal support) the process of bankruptcy discharges all the loans you currently have leaving you with a clean slate. Lenders are eager to loan to people with little to no other financial obligations since it ensures that they can afford the monthly payment on their new loan.
2) You have a job. As I mentioned earlier, most post-bankruptcy loans will only be possible once you find a job. If you have consistent employment for five years or more, you are in a really good position since that shows your ability to stay in a position and draw a reliable paycheck. Since you have a job, should you fail to repay your post-bankruptcy loan, the lender knows that he has the option to garnish your wages.
3) You cannot file for bankruptcy again. Once you complete the process of filing for bankruptcy, you are not allowed to do so again for a long period of time. This discourages bankruptcy law from enabling bad spending habits. Lenders offering you a post-bankruptcy loan will know how long you have until you are eligible for another bankruptcy filing and will therefore only offer you a loan with a term inside of that timeframe. This actually makes you an ideal candidate to lend to since you do not have the option of filing for bankruptcy and walking away from the lending table, leaving the lender with nothing.
Loan Qualifications after Bankruptcy
Though your life after bankruptcy does not mean that no loans are available, the ones that are offered will be sparse. Generally, you can expect a lender to offer no more than a $5,000 unsecured loan. However, taking this loan and repaying it according to terms is a really important first step in getting your financial life back on track after bankruptcy.
Another option you should look into is the use of secured credit cards as a means to build a new credit history. These options are often offered by the same lenders who specialize in post-bankruptcy loans and are a safe way to begin to rebuild credit.
Finally, make sure that your life after going bankrupt includes a healthy assessment of the attitudes and habits that led to these problems. By making positive changes today, you set yourself up for a brighter financial future in the years to come.

Joycelyn Crawford is the author of this article. For more information about Easy Loans for Bad Credit and Easy Home Equity Loan please visit EasyLoanForYou.com.

Federal Exemptions and Personal Bankruptcy

Declaring a Chapter 7 or a Chapter 13 personal bankruptcy with a bankruptcy lawyer is an option that you can take if you've been struggling with mounting bills, crippling credit card payments and other debts that are eating away at your hard-earned money.
Filing for bankruptcy is a relatively easy process - especially with an experienced bankruptcy attorney by your side - that can take anywhere from three to six months to finalize, and can give you that much-needed chance to give your credit score the healthy boost that it needs. When filing for bankruptcy, it's important to remember that there are certain debts that can be claimed as an exemption, both on the state and federal level. Luckily, we've got the rundown of what exemptions you can claim when filing.
When you file for bankruptcy, there are certain debts that are federally exempt from being forgiven. These debts include alimony, child support and some income taxes. Until 2005, this exemption used to include student loan payments; however, laws have been passed to exclude student loan debt from federal exemptions. Of course, it's important to distinguish between state and federal exemptions; depending upon where you reside, you can choose up to the following exemptions as opposed to any state exemptions:

• Homestead - Real property to $17,450
• Insurance - Unemployment or disability benefits; life insurance for any dependents; life insurance policy values up to $9,300; life insurance contracts that have not yet matured.
• Other payments - Alimony; child support payments.
• Pensions - Those needed for support
• Public Benefits - These exemptions can include social security payments, public assistance, unemployment compensation, veteran's assistance, etc.
• Education Funds - If you've got savings accumulating in an educational retirement account or an approved tuition program and have opened it over a year ago - and it will directly benefit your child or grandchild - this is excluded from your debtor's estate.

In addition to these assets, you can exempt up to $925 of any personal property, as defined by Law Section (d)(5). In this way, you can keep some personal property from being included in your debtor's estate. If you want to find out if a state or federal exemption will allow you to keep more personal assets, ask your bankruptcy lawyer, who will be better able to assist you with identifying what exemptions you can claim.
Not sure what state you should use in order to claim your state exemption? Simple: you can claim that state's exemption if you've resided there for more than two years.
Declaring bankruptcy can give you that financial freedom that you've been dreaming of for so long.

Important Aspects Of Chapter 13 Bankruptcy

When it comes to deciding on which type of bankruptcy to file, many people know very little about either Chapter 7 or Chapter 13. The most important piece of information about bankruptcy is that, as a filer, you have very little control over which type of bankruptcy you will be eligible to file.
Recent changes to bankruptcy laws makes it more difficult for many people to qualify for Chapter 7, which is now reserved for those whose debt burdens are matched by an income that is lower than the average income of the state they reside in. When this happens you may only be eligible to receive debt relief assistance through Chapter 13 repayment plan, rather than debt elimination through Chapter 7.
The Differences
In Chapter 7 bankruptcy, you can file for a complete debt elimination, which means your debts will be erased through (a) the creditor writing off the debt as a loss or (b) the creditor obtaining a partial debt payment through asset liquidation. Either way, Chapter 7 provides debt relief for anyone who cannot afford to repay their debts through a structured payment plan.
Chapter 13 allows for your debts to be negotiated and repaid over a three to five year period. The repayment plan is developed according to the amount of debt you are able to pay and approved by the court. Once the court approves the plan, your creditors have very little recourse for collecting on the debts. Instead, they must accept the debt payments as outlined in the Chapter 13 plan.
The Benefits
In a Chapter 13 plan, you may be able to obtain a reduction in the amount of debt owed for certain types of debts. Unsecured debts such as credit cards and medical bills are easily negotiated down to fractions of the actual amount owed. Secured debts such as a mortgage or car cannot be reduced and must be repaid in full. However, secured debt assets are better protected against liquidation through a Chapter 13 repayment plan.
Repaying debts through Chapter 13 allows for you to keep possession of the property and keep your assets out of the hands of creditors. In a Chapter 7, you may be forced to give up certain assets in order to satisfy your debts to creditors. By repaying the debt, you will be able to take ownership of the asset once the debt is satisfied.
Chapter 13 also offers better credit protection than Chapter 7 bankruptcy. The majority of the damage done to your credit is prior to filing for bankruptcy. However, having satisfied your debts through repayment, your creditors are more likely to report favorable information for anyone that has completed a repayment plan. Future creditors are also more likely to look favorably on someone who has repaid their debts rather than had them eliminated.

Meeting Of Creditors: What Can Go Wrong

So you filed your bankruptcy case and you're preparing for your meeting of creditors. For most debtors the meeting of creditors is the most important (and likely the only) meeting they will have during their bankruptcy case. Ironically, most creditors don't show up for this meeting, the meeting is mostly the bankruptcy trustee's examination of the debtor. During this meeting the bankruptcy trustee confirms the information in the petition and tries to ascertain what assets/liabilities the debtor may have that weren't included in the initial bankruptcy petition. While the meeting of creditors usually goes on for a few minutes with no problem, there are a few things that can go long, let's take a look at a few:
Lack Of Identification
The bankruptcy debtor is required to present sufficient identification at the meeting of creditors. The trustee will require a photo id and proof of the debtor's social security number. Typically, the bankruptcy debtor can use a driver's license and a social security card as proof of ID. However, if this is not available, they can present a state-issued photo ID, passport, pay stub or any correspondence from the Social Security Administration and/or a current W-2.
If a debtor fails to present sufficient ID, the bankruptcy trustee can refuse to see them at the meeting of creditors. But typically, the trustee will see the debtor despite the lack of ID and ask that the they present ID later.
Fake Social Security Number
Some debtors without legal documents and using fake social security numbers could face problems at their meeting of creditors. When the bankruptcy trustee discovers that the social security number is fake or belongs to another person, the debtor will probably be turned away and could face legal consequences. If you don't have a social security number, you can discuss this issue with your bankruptcy attorney before you file. You do not need to be a citizen to file bankruptcy. However, you do need to present proper identification and possibly a taxpayer ID number.
Failure To Include Some Creditors
Some debtors arrive at the meeting of creditors and realize that they have inadvertently omitted some creditors. If this is the case, immediately tell your bankruptcy attorney. Do not withhold this information. Once the bankruptcy attorney knows that creditors were omitted they can inform the trustee and inform them that they plan to amend the bankruptcy schedules. The same rule applies to assets. If you forgot to include an asset or income, or if your income and assets have changed since you filed bankruptcy, let your bankruptcy attorney know. The trustee will give the attorney an opportunity to amend the schedules so that they are accurate.