Attorney Charles Gravett has had extensive experience representing both Napa businesses and individuals through the bankruptcy process.

By an  Act of Congress and the President of the United States, we are a federally designated Debt Relief Agency.  We help people file for relief under the United States Bankruptcy Code.


Changes in the bankruptcy laws in the recent past has made the filing and discharge of bankruptcy more complex. New criteria and regulations must be met in order to qualify for a discharge of debt in bankruptcy for consumers and businesses.

SOME HIGHLIGHTS OF THE BANKRUPTCY CODE REVISION


The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) enacted April 20, 2005), was a law enacting several significant changes to the U.S. Bankruptcy Code. It was passed by the 109th United States Congress on April 14, 2005 and signed into law by President George W. Bush on April 20, 2005. Most provisions of the act apply to cases filed on or after October 17, 2005. Referred to colloquially as the "New Bankruptcy Law", the Act of Congress attempts to, among other things, make it more difficult for some consumers to file bankruptcy under Chapter 7; some of these consumers may instead utilize Chapter 13.

Prior to the BAPCPA Amendments, debtors of all incomes could file for bankruptcy under Chapter 7. BAPCPA restricted the number of debtors that could declare Chapter 7 bankruptcy. The act sets out a method to calculate a debtor's income, and compares this amount to the median income of the debtor's state. If the debtor's income is above the median income amount of the debtor's state, the debtor is subject to a "means test." Only debtors whose monthly income is higher than the median income of their state, as calculated by the Code, are subject to being found abusive under the code. Debtors whose whose income falls below the median income figure may be in violation of the means test, however no party is permitted to file a motion in order to find abuse under certain provisions of the code. This creates a means test "safe harbor" for debtors below the state's median income figure.

Other noteworthy changes brought by the 2005 BAPCPA amendments occurred when Congress amended a section of the Bankruptcy Code to provide for the dismissal or conversion of a Chapter 7 case upon a finding of “abuse” by an individual debtor (or married couple) with “primarily consumer debt.” The pre-BAPCPA language provided for dismissal of a chapter 7 case upon a finding of “substantial abuse.” Under the former code, only the court or the United States trustee could bring a motion to find abuse under the section. The 2005 amendments removed these restrictions.

Another major change to the law enacted by BAPCPA deals with eligibility. Section 109(h) provides that a debtor will no longer be eligible to file under either chapter 7 or chapter 13 unless within 180 days prior to filing the debtor received an "individual or group briefing" from a nonprofit budget and credit counseling agency approved by the United States trustee or bankruptcy administrator.

The new legislation also requires that all individual debtors in either chapter 7 or chapter 13 complete an "instructional course concerning personal financial management." If a chapter 7 debtor does not complete the course, it constitutes grounds for denial of discharge pursuant to the new code.

There are additional changes required by BAPCPA concerning student loans, additional filing requirements and fees, increased attorney liability and costs, increased compliance requirements for small businesses and increased amount of debt repayment under Chapter 13. 

If you are considering filing bankruptcy, it is critical to consult with a knowledgeable attorney who can help you make the best decisions for your situation in light of these new restrictions. Call our office at 707-258-1030.



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USEFUL LINKS

The Pros & Cons of Filing Bankruptcy
Will Bankruptcy Eliminate My Debts?
Alternatives to Bankruptcy
National Consumer Law Center
California State Bar Pamphlet
"What Can I Do If I Can't Pay My Debts?

Federal Trade Commission:
Choosing A Credit Counselor


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