2005 Law Changes Haven't Affected Majority

Writer Jeanne Sahadi from cnnmoney.com recently wrote an article about how the 2005 law changes to the Bankruptcy Code have not affected bankruptcy filings as drastically as some experts initially predicted. Now one year since the new bankruptcy laws went into effect, this also seems to be the same concurrent opinion of many consumer bankruptcy attorneys from around the country.Â

It’s true that many of us bankruptcy lawyers were fearful that the law changes would legally prevent a certain percentage of our population from filing bankruptcy and leave those people no opportunity to get a fresh start financially.   However, most of us attorneys have now found a year later that a large majority of our new clientele who would have qualified for bankruptcy relief under the old law without any hassle, also still qualify for bankruptcy relief under the new current law as well.Â

The calendar year of 2005 saw a huge surge in bankruptcy filings nationwide as people rushed to get their cases filed before the law change went into effect.  This of course helps to explain why bankruptcy filings are significantly down nationally this year compared to last year or even 2004. Contributing to this decrease in filings has also been a widely spread rumor that bankruptcy was not available any longer and/or that our government did away with the bankruptcy law.  This of course is far from the truth and reminds one not to believe everything they hear.   Â

So while it may not be fair or accurate to compare the number of clients coming into our doors from last year (2005) to this year (2006), we as attorneys are still finding that a steady stream of people are still in need of some sort of financial assistance and that bankruptcy is still available to a vast majority of them.Â

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