Bankruptcy Filing Online - Can It Still Be Done?

Many people mistakenly assume that the bankruptcy reform legislation means that bankruptcy relief is no longer an available option.  This is not true. The new laws did not make bankruptcy an obsolete remedy, but they have created much more paperwork and legal requirements.

	Can I File Bankruptcy By Myself? In short, yes. Although the new bankruptcy laws are complicated, there are some very good  and affordable online bankruptcy filing form packages available for less than $50. Take a look. We feel that you are best protected by working with an attorney. Get help from a qualified bankruptcy lawyer right now. There is no charge.

The Rush to Personal Bankruptcy Filings

Fueled by fear of the new legislation, a record breaking number of bankruptcy petitions were filed in the month preceding October 17, 2005.  Overall, 2005 closed with a staggering 42% increase in Chapter 7 bankruptcy filings.  National Public Radio reported that one out of every 53 Americans filed for bankruptcy protection in 2005. 

The Bankruptcy Reform and Consumer Protection Act of 2005 made significant changes to the bankruptcy code.  Nevertheless, it appears that the number of bankruptcy petitions are on the rise again.  While the "jury is still out," so to speak, because there is no definitive data, some experts predict that the level of filings may soon be reaching "normal" levels similar to pre-reform periods. 

For the Truly Financially-Challenged Individual, the New Laws Probably Make No Substantive Difference -- Except for More Complex Paperwork and Other Requirements 

Industry experts are finding that the "means test" associated with the new legislation doesn't mean much.  For example, the new bankruptcy rules compare a debtor's annual income with the average income of his or her state. Persons filing for bankruptcy protection generally earn less than the median income in their state, making them eligible for Chapter 7 protection. [Example:  The median income for the state is $36,000 and the debtor filing for bankruptcy protection earns $28,000.  This means that the debtor qualifies for Chapter 7 protection.]  Although there is more complex paperwork and more legal expense involved under the new rules, theoretically, for most people seeking protection, there is no difference between eligibility to file under the new law and old law.

One of the major changes envisioned the bankruptcy code was to make it more difficult to file for bankruptcy, particularly Chapter 7 protection in which credit card  and other debts are "wiped out." A goal of the new law was to force persons filing for bankruptcy to make an effort to pay off some of their debts.  However, the Washington Post reported on January 17, 2006, that the credit counseling requirements under the new law are not making much of a difference for people who are hit hard with financial difficulties.  Credit counselors are having to advise their clients that bankruptcy may be the only viable form of protection available because the clients simply do not have the revenue to pay off their debts.

Next: Look at the New Bankruptcy Legislation