There have been changes in the bankruptcy laws which came into effect on Oct. 17, 2005. The most noticeable is the "Means Test". This test is a measure of your income to determine whether you can file a Chapter 7 or whether you must file a Chapter 13. You must also have a counseling session with a Credit Counseling Agency before you may file and you must complete a debt management course before your debts are discharged.

In a chapter 7 case, if you have any non-exempt assets, these may be liquidated by the Trustee and used to pay creditors. It is extremely important to list all of your assets and all of your debts. Failure to do so may jeopardize your bankruptcy and, potentially, subject you to criminal penalties.

   In a chapter 13 case, you will be making monthly payments to a Trustee for three to five years. The amount paid is determined by several factors including the amount of your regular income and expenses.

   Bankruptcy is intended to give a "fresh start" to people who have fallen into an impossible financial situation. While it is a "last resort", it is a valuable tool to put people back on their feet and give them a chance to be productive and responsible citizens once more.

   It is impossible to discuss all the benefits and burdens in a bankruptcy, even cursorily, on this small page. If you wish to know more or are considering a bankruptcy, you must consult with a qualified attorney.