Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCA) of 2005: Part I

You probably have spent some time researching different bankruptcy attorneys and their informational web sites — and you probably keep coming across information about this new Bankruptcy reform: the Bankruptcy Abuse Prevention and Consumer Protection (BAPCA).

In 2005, Congress passed and President George W. Bush signed the reform, making this the most significant overhaul to bankruptcy laws and filings since the original bankruptcy code was enacted in 1978. The new law and provisions adds further stipulations and can be complicated, making an individual seeking relief through a Chapter 7 or Chapter 13 bankruptcy filing more difficult. However, if filing bankruptcy is the only option for you, there are ways to still qualify for either a Chapter 7 or Chapter 13 bankruptcy — and you can soon begin your fresh, second start on life.

New Credit Counseling requirements before filing Chapter 7 or Chapter 13 Bankruptcies
Both Chapter 7 and Chapter 13 Bankruptcy filings now requires the debtor to complete a Credit Counseling Program with an agency approved by the U.S. Trustee's offices. The primary goal of these sessions is to determine if it’s really necessary for the individual to pursue filing for Bankruptcy in the first place.

While the filer must attend counseling, it is not necessary to follow the counselor’s advice or proposed plans. Before filing, however, any proposed payment plan must be submitted to the court, along with a certificate that the counseling has been completed.

Upon completion of the bankruptcy filing, the debtor must attend an additional counseling session in personal finance management before the court discharges the debts.