what is the bapcpa

United States Courts. As Congressman F. James Sensenbrenner Jr. (R-Wis), one of the bill's key supporters in the House, argued, "This bill will help restore responsibility and integrity to the bankruptcy system by cracking down on fraudulent, abusive, and opportunistic bankruptcy claims. These arguments were bolstered by an in-depth study and survey of 1,771 bankruptcy cases by scholars at Harvard University, of whom 931 submitted to interviews. Although BAPCPA is intended to make bankruptcy filing more difficult, there are several exceptions to this. The new notice provisions require the debtor to give notice of the bankruptcy to the creditor at an "address filed by the creditor with the court," or "at an address stated in two communications from the creditor to the debtor within 90 days of the filing of the bankruptcy case. Current monthly income is defined in 11 U.S.C. § 727(a)(8) was amended to provide that the debtor would be denied a discharge if a debtor had received a discharge in a prior Chapter 7 case filed within eight (8) years of the filing of the present case. "This would ensure that market participants always have some skin in the game, and it would be very strong medicine indeed," Bair said. If the debtor's income is above the median income amount of the debtor's state, the debtor is subject to a "means test."[2]. Means Test and Consumer Debtors The most noteworthy change brought by the 2005 BAPCPA amendments occurred within 11 U.S.C. 109–8, 119 Stat. § 707(b)(3)]. To complete a means test, a debtor must submit either Form 122A—1 for Chapter 7 or Form 122C for Chapter 13 to the Bankruptcy Court before the court will hear the case.. The Act created a bankruptcy means test that determines whether individuals filing for bankruptcy can file for Chapter 7 bankruptcy, which discharges many debts in full—or whether they must opt for Chapter 13 bankruptcy, which requires at least partial repayment of debts. In effect, three outcomes are possible from the means test: Consumers and businesses that plan to file for bankruptcy must complete an accredited nonprofit credit counseling program no more than 180 days prior to filing. [11][12] Professor Elizabeth Warren, a member of the National Bankruptcy Review Commission at that time, briefed First Lady Clinton on negative effects of the bill; according to Warren, after the briefing: President Clinton had been showing that this is another way that he could be helpful to business. Even in cases where there is no presumption of abuse, it is still possible for a Chapter 7 case to be dismissed or converted. Those were definitely the most publicized provisions in the newly enacted legislation. By: Donald L Swanson One of the travesties of our current bankruptcy laws is the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (aka “BAPCPA”). Under the new law, the homestead exemption, which allows bankruptcy filers in some states to exempt the value of their homes from creditors, is limited in various ways. [24], The 2005 bankruptcy bill was opposed by a wide variety of groups, including consumer advocates, legal scholars, retired bankruptcy judges, and the editorial pages of many national and regional newspapers. A debtor will pass the means test if their monthly. Accessed Sept. 13, 2020. She got it. [7], BAPCPA enacts a provision that protects creditors from monetary penalties for violating the stay if the debtor did not give "effective" notice pursuant to § 342, [§ 342(g)]. continued contributions to tax-exempt charities. Bankruptcy is a legal proceeding for people or businesses that are unable to repay their outstanding debts. The presumption of fraud in the use of credit cards was expanded.

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