Federal Bankruptcy Laws
In general terms the Bankruptcy Reform Law of 2005 impacts people in four ways:
1. If your family earns over the median income, you MUST file Chapter 13, you are not eligible to file Chapter 7. For those close to the median, you may not qualify to file a Chapter 7 and you may have too little income to file a Chapter 13. Using IRS Guidelines we calculated incomes likely to be covered by the means test. If your income is greater than the allowed expenses from the IRS Guidelines - expect Trustees AND CREDITORS to object to a Chapter 7 even if your income is below the median. In Texas, the median income for an individual is about $39,673 and for a family of four, it is about $63,859.
2. BEFORE you file, you will be required to attend a credit-counseling course (offered by phone or internet) that explains the various types of bankruptcy and what the pros and cons of each is. Maida Law Firm can help you do this. You must get this from an approved not-for-profit agency. AFTER filing, you will be required to attend a second financial management course. You must complete the courses - and pay for them - before filing bankrupcty and obtaining any bankruptcy discharge.
3. Bankruptcy will no longer protect you if you are a tenant facing eviction. If you filed a bankruptcy in the previous 2 years, you will have little or no protection from foreclosure either. You may find yourself with fewer exemptions than in the past as well.
4. Your bankruptcy attorney, whether it is us at Maida Law Firm or anywhere else will have to check and verify everything you tell them.
You will need to provide us:
- three years of tax returns, not your copy, the transcript from the IRS;
- at least one year of bank statements, credit card statements, loan statements;
- at least 6 months of pay stubs (for all employers);
- an appraisal on your home and vehicles;
- a comprehensive list of personal property - furnishings; a year of utility bills
- Exact addresses used by all of your creditors, at least twice in the last 90 days.
If you miss anything, and if the attorney doesn't catch it in the review of your paperwork, the Trustee, the Court or ANY CREDITOR can object to your case and we will have to PROVE our figures and information. If we cannot, WE will have to pay the costs of their attorney's objection. And, you may not get a discharge of some or all your debts. There is no limit to OUR liability. Insurers of bankruptcy attorneys are already warning of 20-33% increases in premiums right from the start...with no guarantee that the increases will be in any way limited in the future. Some insurers are not planning on continuing coverage. This means we have faced some stiff increases in costs, costs that will be reflected in the fees that we charge.
Contact the bankruptcy attorneys at the Maida Law Firm for a free consultation. Contact us online or call us in our Houston office at (713) 987-3910 or in Beaumont at (409) 291-5117.
