There’s a new bankruptcy bill that’s up for vote in the Senate. if it passes, and it probably will, filing for bankruptcy will be harder. More specifically, fewer people will be able to file under Chapter 7, where creditors will get nothing and all debt is liquidated, and instead will be forced to file under Chapter 13, which provides for a five-year maximum repayment plan.
Some people believe the bankruptcy laws have been abused and there should be tighter restrictions. Advocacy groups claim that it’s a gift to credit card companies, who stand to gain $1 billion or more.
Here is a basic list of the changes between the old law and the new bill. You can read CNN’s story for more information.
* The test for qualification for bankruptcy
* Determining what you can afford to pay back
* The right for creditors to contest your claim
* Liability for the filing lawyer