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You may be aware that Congress amended the bankruptcy laws effective for cases filed after October 17, 2005. The Bankruptcy Reform Act established limits for high-income Chapter 7 filers, and established minimum payments for some Chapter 13 plans. It also mandated credit counseling, and financial management courses, for bankruptcy debtors, and significantly expanded the paperwork and documentation requirements for filing bankruptcy.

However, the vast majority of persons who could file for Chapter 7 before the new law can still file for Chapter 7 now. Proprietary research done by Best Case Solutions, Inc., indicates that only 10 to 15 percent of bankruptcy debtors will have income subjecting them to the new “means test.” Additionally, the director of the American Bankruptcy Institute recently estimated that only about three percent of all debtors will be adversely affected by the 2005 Bankruptcy Act. This means that if you are experiencing financial problems, it is very likely you can still file for bankruptcy, if that is appropriate for you.

The worst-case scenario is that you may have to file a three to five year Chapter 13 plan. In a Chapter 13, you are simply required to pay what you can afford toward your debts, and the rest is discharged.

For most people, it is not true that bankruptcy relief is no longer available. To discuss your unique situation, call our office to arrange a free consultation. An attorney will be glad to explain what bankruptcy can do for you.