New Bankruptcy Law - Effects on Natural Disaster Victims

You’ve heard of the new bankruptcy law, whether you be after to register for bankruptcy or not. The law referred to as "The Bankruptcy Maltreatment Prevention and Consumer Protection Act of 2005", took consequence on October 17, 2005. The law enforces limitations on who can register for bankruptcy under chapter 7.

Following Hurricanes Katrina and Rita, the United States Trustee’s office announced particular guidelines intended to decrease the impact of the new law on victims of natural disaster. Many victims of the hurricane not only lost their homes but have got got no manner of meeting the stringent loading of paperwork required to register for bankruptcy.

Some of the freedoms made for victims of natural catastrophe include the following:

Mandatory Credit Counseling – The demand to experience mandatory credit counseling is waived.

Paperwork Load – Filers who cannot supply the paperwork needed to register for bankruptcy will not be penalized.

Passing the “Means Test” – Filers have a batch more leeway, when it come ups to passing the agency diagnostic test because lost income and other negative financial personal effects of the catastrophe are considered as “special circumstances” that may allow a debtor, who otherwise wouldn’t passing the “means test” to register for bankruptcy under chapter 7.

Access the summary listing of changes per the new bankruptcy law and how possible filers will be affected.