Legal Question in Bankruptcy in Indiana

Re: Changes in the law

There is a bankruptcy bill pending in Congress which will

radically change the rules for Chapter 7 bankruptcies. Many

thought the bill's chances for passage were slim, but the bill

seems to have made a dramatic comeback over the last few weeks.

Of course, it hasn't passed yet and we don't know exactly what it

will say if it is passed. Almost everyone agrees, however, that

severe restrictions will be placed on consumer bankruptcy filings.

I recommend that you consult with a bankruptcy professional about

your situation immediately, to make sure that the new legislation

does not prevent you from filing.

Re: Changes in the law

Until the exact wording and intent of a statute are known (that is, it is passed by Congress and enacted into law), it is impossible to speculate upon the effect the law will have. Nonetheless, the law has been moving toward a stricter application of chapter 7 (which is pretty much a blanket discharge of unsecured debts) and a more liberal application of chapters 11, 12 and 13 (which are reorganizations geared to repay debts at a slower rate than the creditors require). It seems that Congress has been preferring repayment plans for over 10 years, but that the consumers are resisting the application of Congressional intent.