Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCA) of 2005: Part III
In 2005, Congress passed and President George W. Bush signed the new bankruptcy reform, making this the most significant overhaul to bankruptcy laws and filings since the original bankruptcy code was enacted in 1978. The new bankruptcy law and provisions adds further stipulations and can be complicated, making an individual seeking relief through a Chapter 7 or Chapter 13 bankruptcy filing more difficult. However, if filing bankruptcy is the only option for you, there are ways to still qualify for either a Chapter 7 or Chapter 13 bankruptcy — and you can soon begin your fresh, second start on life.
In “BAPCA: Part I” information regarding the new credit counseling requirements was offered up: basically stating that there are now Credit Counseling Programs that are mandatory before anyone is eligible to qualify for filing a Chapter 7 or Chapter 13 bankruptcy.
In “BAPCA: Part II” information was provided regarding the new limits to Chapter 7 Bankruptcy eligibility including the “Means Test” and how the Bankruptcy Court determines who can file for a Chapter 7 or whether or not they will have to move over to a Chapter 13 Bankruptcy.
There are many other significant changes to Bankruptcy law from the BAPCA reform. Here is a break down of those new changes.
Some of the significant new provisions to the Bankruptcy Prevention and Consumer Protection Act of 2005:
• Debtors must pursue Credit Counseling before filing for bankruptcy.
• Debtors must also undergo additional counseling, both for budgeting and debt management.
• Debtors with incomes above a certain level may not be able to file for Chapter 7 bankruptcies; they may be required to repay portions of their debts through filing a Chapter 13 Bankruptcy.
• Chapter 7 Bankruptcies have an extended waiting period between six and eight years.
• In a Chapter 13 Bankruptcy Filing, if your income is above the state’s median income, the filer must pay back debts within a five-year plan.
• Attorneys are subject to new Bankruptcy Law requirements, which may make it more difficult (and more expensive) for filers to find lawyers to handle their cases.