Know About US Federal Bankruptcy Law in Detail

Bankruptcy is a serious economic down turn for an individual or an organization where the dispensation of debts simply becomes next to impossible because there's hardly any finance left in the kitty. Federal bankruptcy Laws are there to help the individual or an organization to file under Chapter 7 Bankruptcy, or Chapter 13 Bankruptcy or Chapter 11 Bankruptcy. The Bankruptcy Law, which is also popular as the Bankruptcy Code of the United States of America, quotes the 1978 Bankruptcy Reform Act as Codified in The Unites States Code under Title 11. Anyone filing under the Chapter 7 Bankruptcy will have to sell of his or her assets so that all the debts can be paid off. Assets are classified as exempt and non-exempt. The non-exempt assets are meant for the creditors.

Chapter 13 Bankruptcy is for those individuals and organizations who have insufficient assets to pay back to the creditors, but who are still making the money. The creditor will put the claims on hold until it is decided by the debtor. The debtor will hold the possession of his/her assets as decided mutually by the creditors and the court. The Chapter 11 Bankruptcy aims at restructuring and providing the remedies to the bankrupt individuals and the organizations. The repayment methodologies are similar to Chapter 13 Bankruptcy.

Get ready to avail the benefits under the federal government's bankruptcy law. But, before you actually do it, you have to be pretty sure that all the terms and conditions are known to you. Whether you are applying for Chapter 7 or Chapter 13 or Chapter 11 bankruptcy, you have to be pretty sure about all the clauses delineated in it. If you miss any of the clauses, then you will miss your eligibility requirements. If you find that the terms and conditions of bankruptcy are not understandable to you, the best thing to do is hire the services of efficient bankruptcy lawyer or attorney. In this way, you will not only be saving your time and money, but also be progressing in the right manner to file your bankruptcy application. Do your homework right in the beginning as bankruptcy judge may ask you quite a number of questions before actually qualifying your candidature.

File Federal bankruptcy depending on your financial condition and as per the court's decision. Hire the services of an efficient bankruptcy lawyer to help you in consummating the Bankruptcy successfully and quickly.

The Fair Debt Collection Practices Act

The Fair Debt Collection Practice Act (FDCPA) is a statute that was added to the Consumer Credit Protection Act by Congress in 1978. The FDCPA sets forth guidelines for debt collection practices in order to protect consumers from abuse, allow for the validation of alleged debts, and ensure the rights of consumers. The FDCPA governs many different types of debt collectors, whether they be a dedicated agency, an individual, or a practicing attorney.

Practices Forbidden by FDCPA:

The FDCPA prohibits debt collectors from engaging a variety of behaviors or practices considered to be abusive or unethical. For example, debt collectors may only contact a debtor during "normal" hours, defined as the time between 8 AM and 9 PM, unless permitted to do otherwise by the debtor.

In general, consumers' rights are heavily guarded by the FDCPA. Under the statute, a debtor can force a collection agency to refrain from further contact by a simple written notice. The only exceptions to this rule are a) notifying the consumer that collection efforts have ceased, and b) notifying the consumer of any further action, such as a lawsuit, that the creditor intends to pursue.

Protocol Required by FDCPA:

The FDCPA also obligates debt collectors to provide certain information about themselves and the creditor they represent. They must identify both themselves and the creditor, including both name and address, inform the consumer of their right to dispute the debt, and provide validation of a debt in the case of a formal dispute.

Debate over FDCPA:

The process of debt collection is stringently regulated and highly technical. The FDCPA's provisions are enforced by the Federal Trade Commission. Furthermore, violations of the FDCPA also allow the affected private citizen(s) to sue to recover compensation up to $1,000, plus any damages caused by the violation.

Not everyone is happy with the FDCPA as it stands, however. In fact, the FDCPA has come under fire from both consumer advocates and industry representatives. In the former case, consumer advocates feel that the penalties allowed by the FDCPA are not sufficient deterrents to abusive collection practices, partially due to the fact that fines have not been scaled to inflation. On the other hand, the collection industry complains that the heavy regulations of the FDCPA promote frivolous and time-consuming lawsuits over minor technical details, and thus impedes their ability and right to collect on valid, legitimate debts.

Bankruptcy Law Practice - Who's the Best?

Getting good legal advice is the most important factor in filing for bankruptcy successfully. In the past, some individuals attempted to go through the process by themselves. You may even have some friends or relatives who claim that they declared bankruptcy without a lawyer several years back. However, times have changed, and so has the bankruptcy statute.

In 2005, Congress passed a law which created some changes in the bankruptcy code. Many bankruptcy attorneys have criticized this law because they claim it is bad for consumers. Meanwhile, many members of Congress defended the law because they believed that some were taking advantage of the bankruptcy statutes and getting rid of their debts much too easily.

For better or for worse, the changes in the bankruptcy law are with us (at least for now). The reason that this is so important is that the bankruptcy code has become much more complex as a result of this new law. The law is so complex that even many lawyers struggled to figure out exactly what it meant. Judges will probably be making various rulings on the law and try to interpret its meaning for years to come.

This is why legal counsel is absolutely required if you decide to declare bankruptcy. However, not just any lawyer will do. As we have already stated, keeping up with the bankruptcy laws and their corresponding court rulings can be a nightmare for anyone not specializing in bankruptcy law.

This is why we highly recommend that you pick the lawyer who specializes in bankruptcy law. A bankruptcy law practice aims to keep up with all of the latest developments and offers you the best shot for a successful bankruptcy filing.

Every case is different, and your bankruptcy case will likely have its own challenges and unique circumstances. That's why you need a specialist in the law to help you decide the best course of action for you and your family

How the Fair Debt Collection Practices Act Helps You

The Fair Debt Collection Practices Act, which is more commonly referred to as the FDCPA, is a statute in the United States that is designed to protect consumers who have creditors who are attempting to collect a debt from them. This act has several important features that are designed to accomplish this. You should be aware of these.

One outstanding feature of the FDCPA is to provide consumers with a mechanism of disputing debts that they don't feel they are responsible for. It also provides a convenient way for consumers to keep track of debts that they ARE responsible for. It is helpful to know that there are strict penalties that can be ascribed to companies who break the fair debt collection act.

There are many activities that are not allowed by the Fair Debt Collection Practices Act. For example, creditor harassment is actually defined and prohibited under the act. One common practice that is considered harassment is when the creditor contacts the consumer after they have provided written notice that they do not wish to be further contacted or that they have no intention of paying the debt.

Another example of creditor harassment is contacting the debtor at their place of employment or business after the creditor has been informed in writing by the debtor that they do not wish to be contacted while they are at work. Calling the consumer repeatedly in a way that is intended to annoy, abuse or otherwise harass the consumer is also strictly prohibited.

If you, as the debtor, have an attorney representing you, the creditor or collection agency cannot contact you directly without violating the act. There are also specific hours set up within which a creditor can contact a debtor. If attempts at contact are made outside of these hours, the creditor is in violation of the act. Creditors are also banned from publishing the consumers name on a 'debt list'. Likewise if the creditor insists on contacting the consumer after the consumer has asked for validation of the debt or uses abusive or profane language, the are in contravention of the act.

The Basics of the New Bankruptcy Law

The new bankruptcy law has brought about a number of changes to the filing process. Here are the major ones:

Credit Counseling
The new bankruptcy law dictates that anyone who wants to file bankruptcy must complete credit counseling with an agency approved by the United States Trustee's office. After the bankruptcy case has ended, filers must attend yet another counseling session to learn more about personal financial management.

Restricted Eligibility
In the past, it was possible to choose between filing Chapter 7 or Chapter 13 bankruptcy. Under the new bankruptcy law, eligibility for filing Chapter 7 is based on income. A filer's average income for the six months prior to filing bankruptcy must be below their state's median income.

Property Values
Under old bankruptcy law, those who filed Chapter 7 bankruptcy were allowed to place a value on their personal property based on what they could sell it for at an auction. The new bankruptcy law requires that property now be valued at replacement value. This puts increased value on the property and ensures that more filers will have their property taken and sold by a trustee.

State Exemptions
Under new bankruptcy law, your state's exemptions will apply only if you have lived in the state for two years. If you have been in the state for less than two years, you will receive the exemptions from the state that you lived in previously.

Bankruptcy Laws - What Are Your Rights?

Many individuals sometimes find themselves in certain financial situations, which may need legal attention. They may have debts that are extremely high, and have no way to settle them. Some may have debt that has been hanging over their heads for years, and now has gone into a default status. These individuals may find themselves facing several creditors and bad credit.

Bankruptcy laws may be able to provide some individuals relief, once they have filed with the state. It is important to go over all your bills to see if this is the course of action for you. The bankruptcy court will protect all individuals from any creditors during the bankruptcy process; this will allow the court time enough to figure out the individuals bills.

These laws will also protect filling individuals from losing their cars and homes; due to repossession or foreclosure. Individuals usually file a Chapter 7 or a Chapter 13, depending upon their circumstances. Under the Chapter 13 law you may be entitled to keep your property, if your plan meets the requirement under the law. Most people believe they will not be able to own any property once filing bankruptcy, this is not true. Individuals need to make sure they understand the law, before moving forward with the process. If you are considering medical bill bankruptcy, there are special provisions that you will want to ask your lawyer about.

There are some things that are not covered under the bankruptcy laws. Student loans, which were more than 7 years old used to be covered automatically, but under the new law they are only rare circumstance which may allow student loans to be included. If your only debt is from student loans, bankruptcy laws will not help you.

Chapter 7 bankruptcy can be filed every six years, and a Chapter 13 can be filed at anytime. Individual filing for bankruptcy should have lived the greatest portion of the last six months in the district which they are filing.

It is very important for all individuals to become familiar with the bankruptcy filing process before they file; once the papers are filed with the courts, it is usually a done deal.

Know More About the New Bankruptcy Laws

The government has introduced some new bankruptcy laws for those who wish to file for bankruptcy. That means the persons who have higher incomes can not file themselves for a bankruptcy. They have to pay at least some of their debits under this rule. Before filing for a bankruptcy, they have to get their credit analysis as per the new rule. Sometimes, it is very difficult for somebody to signify themselves in a bankruptcy case because new requirements on the lawyers are enforced according to the rule. The difference between old and new rules is described briefly below.

Considering the old rules, one could make a choice of bankruptcy type that is most suitable for him/her. But, according to the new rule, those who wish to file for bankruptcy can be restricted based on the income levels and those with higher income levels can’t simply file for bankruptcy under any personal bankruptcy chapter of their choice.

The modify bankruptcy laws state that initially, the current monthly income of the person will be compared with the average income of a person of the same state. If it is found that the current income of the person is equal to or less than the average income, then one can file for bankruptcy, but, on the other hand, if the income level of the person is found to be higher than the average income in the respective state, then he/she may be restricted from filing a case for bankruptcy.

The actual aim of the government to enforce the bankruptcy laws is to find out if a person has more than sufficient income after spending on definite expenses and making needful payments, and stop such individuals from simply filing for bankruptcy despite generating a decent level of income. One can also test his/her candidature privately by cutting off some debit payments and allowed expenses from his/her present monthly income. If the total income left after this calculation is less than average level income in the state, then he/she can file for bankruptcy without any problems.