The US congress passed a set of uniform laws to govern how bankruptcy is dealt
with. In these bankruptcy laws, or the bankruptcy code, there are ways to protect the debtor from being harassed
while they are trying to pay off their loans. The different methods that can be used are set out in certain
chapters of the bankruptcy code.
These bankruptcy chapters such as chapter 11, chapter 9, and chapter
13 are recognized by the judicial courts to be bankruptcy laws that each state must work with. While the main body
of these bankruptcy laws can’t be changed there are various amendments that can be done. These amendments in turn
become part of the bankruptcy laws.
From time to time Congress will change the various sections in the bankruptcy code
to account for the trends and occurrences in today’s business environment. To make sure that you understand what
these new bankruptcy laws are and how they affect you it is best to consult with a lawyer.
You should make sure that you are looking at these bankruptcy laws only if you
have no other recourse for getting out of financial difficulties. As bankruptcy is a very complicated process you
should use this measure only as a last resort.
Since congress can change the bankruptcy laws to reflect our varied lifestyle
expenditure you will find that these laws can make it difficult for you to declare bankruptcy even if you are in
non-solvent position to pay off your creditors.
One of the other effects that can be found in the changes that have been made to
the chapter 7 bankruptcy laws is that all debtors must have credit counseling. This counseling will help the debtor
understand what they can do to avoid getting into debt again. In the counseling sessions you will be given
alternative routes to take with regard paying off your debts.
This credit counseling must be gone through before you can file for bankruptcy. To
have this credit counseling you can only use agents that have been approved by the government. Of course you should
have received a certificate that states that you have gone through with a credit counseling session.
During the credit counseling you may be presented with a plan to pay off your
creditors. Whether you agree with this plan or not you will need to present this plan to the bankruptcy
According to the bankruptcy laws you will need to visit this center when your
bankruptcy case has been filed. This counseling session will be for you to learn about personal finance management.
You must present a certificate from this session of counseling to have your debts discharged fully.
While bankruptcy laws can help protect the person who is in debt trouble, there
are instances where the bankruptcy laws can cause more financial hassles than they were intended for. Therefore
bankruptcy should be a last resort only.