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Filing Bankruptcy In Washington State
When Congress passed the new bankruptcy law in Spring of 2005, the goal was to discourage consumers from using it as a means of getting out of debt. To date, all statistics point to the fact that is has been largely successful in achieving this goal. The way it set about tackling the bankruptcy problem in the country first and foremost was to make it more difficult to qualify for Chapter 7. In a Chapter 7 bankruptcy, most consumers see their debt wiped completely clean without paying much more than attorney fees and courts costs (in most cases). Due to its inexpensive and expeditious nature, many consumers find this to be favorable to Chapter 13 bankruptcy, which requires debtors to pay off the debts owed over three to five years from their monthly disposable income. Even though the debts are essentially being paid off (at least partly) the consumer’s credit still suffers the same black mark of a bankruptcy filing.
Who This Affects
The new bankruptcy law targets consumers who earn more than the median income in Washington (and every other state) for Chapter 13. If you fall under this category, you would be obligated to pass the means test in order to file Chapter 7 bankruptcy. The means test is nothing more than an examination of a debtor’s income and expenses to determine whether or not paying off at least part of the debts is possible. Listed below are the median income figures for Washington as of 2006:
2-person families 58,584
3-person families 66,252
4-person families 75,140
5-person families 68,562
6-person families 62,484
7-or-more-person families 61,212
Due to these tougher restrictions and other financial considerations, more consumers in Washington have started turning to options like credit card settlement and debt counseling for help with their unsecured bills. To get matched with a debt relief firm for a free consultation, submit a form today!
You can also read these articles for more information about Washington credit & debt matters:
Washington Consumer Credit Counseling Services
Washington Bankruptcy Laws
Washington Debt Collection
Filing Bankruptcy In Washington State
When Congress passed the new bankruptcy law in Spring of 2005, the goal was to discourage consumers from using it as a means of getting out of debt. To date, all statistics point to the fact that is has been largely successful in achieving this goal. The way it set about tackling the bankruptcy problem in the country first and foremost was to make it more difficult to qualify for Chapter 7. In a Chapter 7 bankruptcy, most consumers see their debt wiped completely clean without paying much more than attorney fees and courts costs (in most cases). Due to its inexpensive and expeditious nature, many consumers find this to be favorable to Chapter 13 bankruptcy, which requires debtors to pay off the debts owed over three to five years from their monthly disposable income. Even though the debts are essentially being paid off (at least partly) the consumer’s credit still suffers the same black mark of a bankruptcy filing.
Who This Affects
The new bankruptcy law targets consumers who earn more than the median income in Washington (and every other state) for Chapter 13. If you fall under this category, you would be obligated to pass the means test in order to file Chapter 7 bankruptcy. The means test is nothing more than an examination of a debtor’s income and expenses to determine whether or not paying off at least part of the debts is possible. Listed below are the median income figures for Washington as of 2006:
2-person families 58,584
3-person families 66,252
4-person families 75,140
5-person families 68,562
6-person families 62,484
7-or-more-person families 61,212
Due to these tougher restrictions and other financial considerations, more consumers in Washington have started turning to options like credit card settlement and debt counseling for help with their unsecured bills. To get matched with a debt relief firm for a free consultation, submit a form today!
You can also read these articles for more information about Washington credit & debt matters:
Washington Consumer Credit Counseling Services
Washington Bankruptcy Laws
Washington Debt Collection