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Lecture Notes: Bankruptcy |
The following is a set of bankruptcy review notes for my paralegal students who are taking the course in bankruptcy.These review notes come from lecture notes I originally prepared for use in teaching the class. This web site, however, was not developed for, or under the authority of, or with the knowledge of the school. I made this part of website on my own time without using school materials, just to supplement the material for my students who are free to look at this, or not, just as they please. . . .
This is, however, my personal website and I pay for it.
There is a list of bankruptcy topics on the right. Click to go to those pages. I also put a quick note on bankruptcy reform, down below. Just scroll.
In this location throughout all the bankruptcy pages are subtopics within the topic.
Hope it helps.
-Walt
BUT WHAT ABOUT REFORM?As I was putting together this site, bankruptcy reform, threatened for years, looked like it would be passed into law. Well, now it has. There's a lot about it I don't know because it looks like there are a lot of changes in funny places in the code, all throughout. And I haven't, and probably won't go through the bill and compare it to the present code. Here's what it looks like the major features are:
1. Means testing. Used to be, you had to qualify to go into a wage-earners' plan under Chapter 13, but you could file at will under a Chapter 7 liquidation. Now, one must "qualify" for a Chapter 7. First, if you are below average in your state, you can liquidate.
( . . below 50% of the average income for your state. I notice that the commerce department defines Oregon median income for 2003 as $61,570.)
Second, if you have excess monthly income of more than $166.66 a month to pay $10,000 debt over 5 years, you can't qualify for Chapter 7 liquidation. But even if you can't pay the $166.66, then, do you nevertheless have excess income of more than $100 a month to pay 25% of unsecured debts in the next 5 years? If you do, you can't file for a liquidation. Looks to me like you have to be below average for your state, and have less than $100 a month disposable income or have just piles of debt, to avoid being pushed into Chapter 13.
2. State Exemptions: You have to have lived in your state of residence for 2 years to use state exemptions.
3. Homestead exemption: No more than $125,000 if the property was acquired within 3 years, 4 months of filing.
4. Vehicles: Depending on which, House or Senate, bill winds up being law, a reaffirmation of a secured car loan will have to be at the full amount owed on the contract. (At least, that's what I think this means. It sounds like all those vulnerable little finance companies, like GMAC and FoMoCredit, got tired of getting out-negotiated by those cunning debtors.)
I predict the change in the law will do very little to make a difference in how much money creditors actually get. And as far as I can tell, the bill does little to stop what I see as the most common and most expensive abuses of bankruptcy law -- corporate reorganizations under Chapter 11.