THE NEW BANKRUPTCY LAW

        On April 22, 2005, the president signed new bankruptcy legislation, which, for the most part, went into effect on October 17, 2005.  If you file a bankruptcy now, you will be governed by the new law.  If your case were filed on October 16, 2005, or prior, you are governed by the old law.  

        The changes in the new law are significant.  Two new education requirements have been added as well as a means test.  The means test gauges your income against the state median income.  Generally, those above the state median income, plus certain adjustments, will be unable to file a chapter 7 bankruptcy and will have to file a chapter 13 bankruptcy, which has a repayment plan.  Several new disclosures requirements have been added by Congress to the bankruptcy process. 

        The changes in the new law will entail an increase in the attorneys' fees for chapter 7 and chapter 13 cases and also increase the filing fee of a chapter 7 case from $209 to $274.

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