What The Bankruptcy Law Changes Mean To You

Filing for bankruptcy is the last option for people that are in financial crisis and want to get back on their feet. A huge percentage of people that file for bankruptcy – over 40 percent – are forced into it because of a serious health problem

For people that don't have health insurance or a health plan, any catastrophic illness such as a stroke or hear attack, can potentially wreck their finances. Even for many people with health insurance, the combination of premiums and deductibles, can put a major dent in their finances. Especially hit hard are the elderly and families where a single woman is the head of the house hold. It's frightening to think of just how close many people in this country are to foreclosure, bankruptcy, or financial ruin.

The loss of a steady job is the second largest reason why many people have to file for bankruptcy. An abrupt loss of a job because of company layoffs, company outsourcing, or simply a company going out of business can very easily wreck the financial underpinnings of a family that is already knee deep in debt and basically living from paycheck to paycheck. A divorce can lead to a situation of having to support two households instead of one and also possibly alimony payments.

It can be embarrassing knowing that your financial life can simply be condensed into a bankruptcy credit report. Unfortunately, the new bankruptcy law, which became effective October 2005 was basically written by the credit card companies. As you might expect, they changed the law to work in their favor and put in basically no provisions to protect citizens that may have fallen into the above categories.

Just a few month ago, however, the United States House of Representatives held a vote to limit the interest percent that credit card companies can bill their customers for.

The move was prompted by the increasing amount of anger building up from their constituents who see the banks profiting from the misfortunes of customers. The vote was 331-92, one of the rare pieces of bipartisan votes that have been held recently.

Please visit David's website for more articles regarding chapter 13 bankruptcy rules.

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