December 18, 2009

By: Michelle Grinberg

Bankruptcy is an answer for those individuals who have incurred debts that they cannot possibly pay off. Rosemary Gambardella, a U.S. Bankruptcy Court Judge states that bankruptcy is about “rehabilitation. It’s about second chances and fresh starts.” (See New Jersey Law Journal, November 23, 2009, “New Jersey Bankruptcy Judge Joins Judicial Counsel,” p. 16, 25)

However, under the “New Bankruptcy Law” (Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 or BAPCPA), it has become more difficult and tedious for some to file for Bankruptcy. Among other things, debtors are now required to complete a counseling program prior to filing for Bankruptcy and another educational course after filing. Also, if a debtor has previously filed for bankruptcy, the BAPCPA has extended the amount of time a debtor must wait before filing a second bankruptcy. The new law has also greatly increased the amount of paperwork the debtor must provide. Regardless of all these changes, Bankruptcy is still a great option for those looking for a fresh start.