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Bankruptcy
Specifically, in recent years, most bankruptcy filers sought and received Chapter 7 bankruptcy protection, which meant that through the bankruptcy trustee's gathering of assets and paying creditors to the extent possible, bankruptcy filers' debts were discharged so that the bankruptcy filer was no longer obligated on them. Under the new federal law some people may find it harder to qualify for Chapter 7 bankruptcy protection and may be forced into Chapter 13 bankruptcy, instead. In general, a Chapter 13 bankruptcy does not discharge debts; rather, it reorganizes debts so that bankruptcy filers pay their debts, but in a more manageable manner. Chapter 7 protection has not been eliminated; the conditions for qualifying for Chapter 7 have, however, changed.
In addition, Congress made other changes to the national bankruptcy laws such as mandatory credit counseling. In short, bankruptcy has changed. Many of the old practices and concepts no longer apply. If you have questions about the new bankruptcy laws and how they apply to you, please contact our firm for help.
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