Bankruptcy Credit Counseling Under the New Bankruptcy Law
Bankruptcy may be the best solution for extreme financial hardship. However, it should be used as a last resort, since it can have long- lasting consequences in relation to your credit. Under a Chapter 13 plan, you can make regular monthly payments and be given a reasonable period of time to bring your loan payments up to date to save your property. Bankruptcy credit counseling is a requirement of the new bankruptcy law effective October 17, 2005. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 requires court approved bankruptcy credit counseling to be completed by debtors prior to filing for bankruptcy within the 180 days immediately preceding the filing of a bankruptcy petition. The new requirement for bankruptcy credit counseling prior to filing for bankruptcy may be completed by internet credit counseling, phone credit counseling, or group or individual credit counseling at specific, court approved bankruptcy credit counseling agencies. Under the new bankruptcy law, the U. S. Trustee's Office is responsible for approving bankruptcy credit counselors. The U. S. Trustee's Office may approve a nonprofit budget and credit counseling agency or an instructional course concerning personal financial management if the nonprofit budget and credit counseling agency meets certain stringent requirements set forth in the law. The new bankruptcy law has made filing bankruptcy more difficult than ever before. The new bankruptcy law was fueled by credit card companies and their high powered lobbyist who wanted to make it harder for debtors to wipe out credit card debt. Bankruptcy credit counseling has been seen by many bankruptcy attorneys as an attempt to delay a debtor from seeking protection in the bankruptcy court. The delay may be just enough time for a creditor to obtain a judgment or collect garnishment funds. Most bankruptcy lawyers are finding out that the telephonic method of counseling is the easiest for debtors to complete in a hurry. Most telephonic counseling can be completed in about 1 hour.
The maximum amount any bankruptcy credit counseling agency can charge for counseling is set by law. No bankruptcy credit counseling agency can charge more than $50.00 for the credit counseling. Once bankruptcy credit counseling sessions have been completed, debtors are given a certificate of completion from the credit counseling agency to be filed with the bankruptcy court upon filing of the debtor's bankruptcy petition. BankruptcyHelpOnline.org is the bankruptcy resource solution
that makes bankruptcy easy to understand. The Bankruptcy Abuse
Prevention and Consumer Protection Act of 2005 has made filing
bankruptcy more complicated than ever before. BankruptcyHelpOnline.org is your source for useful bankruptcy information that is easy to understand. |
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CAN HOME FORECLOSURE BE PREVENTED? If a person gets behind on his or her house payments, the creditor may call the loan in default, accelerate the debt, and begin foreclosure proceedings. When a debt is accelerated, the full balance of the note, not just the monthly payments, is due, in full, immediately. This is usually preceded by the creditor's refusal to accept monthly payments. In the event a creditor begins foreclosure, you will receive a notice of the foreclosure proceeding. Unless the creditor is willing to accept payments to reinstate the loan, you will have to either pay the full balance remaining on the loan, or file bankruptcy for protection to stop the foreclosure. One additional option is to contact HUD for mortgage assistance. Sometimes creditors will agree to stop foreclosure while HUD is reviewing your file. The beginning of a bankruptcy case, if before the foreclosure sale date, will stop the foreclosure sale from taking place. Under a Chapter 13 plan, you can make regular monthly payments and be given a reasonable period of time to bring your loan payments up to date to save your property. Bankruptcy may be the best solution for extreme financial hardship. However, it should be used as a last resort, since it can have long- lasting consequences in relation to your credit. For more information on foreclosures, consult with an attorney experienced in bankruptcy law. |