Can anyone give me the basics of this new bankruptcy law?

I feel I’m drowning in debt and want to get my head above water. I went through a bad situation recently that caused me to get behind on credit cards and also to have to take out more credit just to survive… I’ve always been faithful and diligent about paying my bills and would hate to file bankruptcy but I don’t see another option…. just wonder if any of you out there know what the new criteria is on filing…. Thanks
how do I find out what the median income is in my area to see if I qualify to file
Current income is around 40,000 annually and really i have about 16,000 in debt with just credit cards. I have some medical bills that are around 6000. I have a 2nd mortgage around 30,000 that I DONT want to file on. I also have four children and my bills each month take most of my income.

This entry was posted on Thursday, December 25th, 2008 at 5:38 am and is filed under Bankruptcy Law. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.

2 Responses to “Can anyone give me the basics of this new bankruptcy law?”

1. Jeff Says:
   December 26th, 2008 at 2:49 am

   There are two types of bankruptcy for individuals:

   1) Chapter 7 (liquidation). The judge orders all of your assets (except maybe your house) to be sold, and all the money given to the people you owe, and the rest of the debts are cancelled.

   2) Chapter 13 (repayment). The judge orders you onto a 3-5 year repayment plan, where your finances are supervised by the court. If you keep up with this plan, all your debts are then forgiven.

   The new law made it a lot harder for people to file Chapter 7. Your income must be lower than the median income (half are more, half are less) for the state you’re living in. Then there’s councelling, and some people can’t file because they can’t afford the filing costs.

   ————

   What’s your personal situation?
   How much debt?
   What’s your income?
   Have you gotten onto a written budget?

2. Paula M Says:
   December 26th, 2008 at 6:53 pm

   Call the Trustee’s office in your area…..you have to complete a financial education class before filing anyway…and they have the list….

   just google your city or county or state and Chapter 7 Trustee…

   You should give us an idea of the amount of debt and your current income level….there are many options you can handle yourself.