New Bankruptcy Law Takes Effect - | Lufkin and Nacogdoches, Texas

10/17/05 - Lufkin

New Bankruptcy Law Takes Effect

by Ramonica R. Jones

The country's new bankruptcy law took effect October 17. Under the new rules, there is less refinancing available and filers will be required to stay bankrupt longer.

The changes make it harder and more expensive to file bankruptcy. About eight years ago, a Bankruptcy Review Commission presented a report to Congress leading to the changes.

Local attorneys said the result is a law that mostly benefits creditors.

Stephen Zayler, Chapter 7 Trustee, said, "It's not easy now, but's it's gonna be even more difficult. There is a lot more paperwork that is involved. There's a lot more information that needs to be provided to the bankruptcy court and to the bankruptcy trustees. It's going to be more expensive. It is gonna be harder to file a Chapter 7; more people will be forced into a Chapter 13 repayment plan."

Chapter 13 bankruptcy is more difficult than Chapter 7 because filers have to stay in the plan longer.

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