Changes Make Bankruptcy Protection Unavailable For Some

Online, October 21, 2010 (Newswire.com) - Sacramento, CA: Changes in bankruptcy law taking effect November 1st will make some residents unable to receive total relief from creditors, or will require paying a larger amount to restructure their debt.

Bankruptcy rules consider the consumer's ability to repay debt to determine if the debtor receives total relief or would be required to pay some of the outstanding bills. The downturn in the nation's economy has reduced the median income of the American household. As income drops, so do the guidelines for bankruptcy.

Unfortunately, as consumers have less income, it becomes more difficult to qualify for Chapter 7 full debt relief. On average, an estimated five per cent drop in income was anticipated in these new figures.

"After Halloween, fewer options are available for some debtors", says Sacramento bankruptcy attorney Anthony Hughes. "As little as $61 a month more income can mean the difference between total relief and a drawn out repayment plan".

Maximum Income for Chapter 7 Bankruptcy Eligibility
Household Size 1 2 3 4
After Nov. 1st $ 47,234 $ 61,954 $ 67,562 $ 77,596
Before Nov 1st $ 47,969 $ 64,647 $ 70,638 $ 79,194
Difference $ 735 $ 2,693 $ 3,076 $ 1,598

Source Anthony Hughes, Esq (http://sactownbankruptcy.com)