The New Bankruptcy Laws

There has been much publicity on the new bankruptcy law, which took affect October 2005, leading many consumers to believe they can no longer file for bankruptcy or that it will be much harder to do so. However bankruptcy is still a viable option for many and you should educate yourself and get a consultation with a bankruptcy attorney to determine whether or not bankruptcy is for you.

Whether you are eligible for Chapter 7 (discharge) or Chapter 13 (repayment) will depend on your income. If you have a higher income you may not qualify to have all your debt discharged but will have the option to repay your debts under a new agreement.

The income criteria is based on the State in which you live. If your household income is equal or lower than the median income for your State, you can still qualify for Chapter 7 bankruptcy assuming you meet other qualifications.. If your income is greater than the median, you must pass "the means test" in order to file for Chapter 7.

"The Means Test" calculates if you would have enough disposable income after subtracting allowed expenses and the payments required under a Chapter 13 plan. If your income falls below a certain point you would be eligible to file for Chapter 7.

The New Bankruptcy law also requires more documentation so you must be prepared to show your paystubs, bank records, tax returns and provide additional information.

All debtors are also required to get credit counseling through an approved agency before filing and additional counseling on budgeting and debt management before the bankruptcy can be discharged. Both these counseling requirements can be completed Online.

For further information about your ability to qualify for bankruptcy contact us

We represent clients in Western Washington, Spokane, Washington and other Eastern Washington communities, including Cheney, Clarkston, Colfax, Colville, Davenport, Ephrata, Moses Lake, Newport, Odessa, Pullman, Ritzville, Republic, Wenatchee, Seattle, Yakima and Walla Walla. We also represent clients in North Idaho, including Bonners Ferry, Coeur d Alene, Hayden, Lewiston, Moscow, Post Falls, Sandpoint, Wallace, Priest River, Plummer, St. Maries and Potlatch.

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