Louisiana Attorney Lawyer

The new insolvency law, could enter into force on October 17, composed of problems for people whose lives were destroyed by Hurricane Katrina.

The new law, it is more difficult and expensive for people to fully repay its debts, and consumer groups against the law say it could not have been a bad time for victims of Katrina. For one thing, knowledge, many are not able to paperwork - tax returns, pay stubs and six months, revenue and expenditure data - required by the new law. Similarly, it is about time to participate on the boards of credit required.

These groups will move to the borders of the Congress of the law of the date of implementation or modification of the law to ensure that Katrina victims can be exempt from their bills.

Accounts receivable in the area of the hurricane, were planning to file before October 17 the deadline can not even be present to a lawyer, let alone an open courthouse, “said B. Travis Plunkett, legislative director of Consumer Federation of America. “They must have the right to file under the old law,” said Plunkett. In the months preceding the victims of the hurricane - or a victim of a natural disaster - should not face an increased risk burden of proof under the new law, he said.

The new rules sufficient flexibility for people of the hurricane, bankers said.

“I am ahnend that, overall, those hardest hit are well below the median income, they are always able to file under Chapter 7, which allows any man wegzaubern their debts,” said Wayne A. Abernathy, Executive Director of the American Bankers Association.

Under the new law, those with incomes above the median of the State must file under Chapter 13, which requires some repay creditors - unless they can prove that this is a special circumstances, as such as health or military leave or that the necessary expenditure are so high that reimbursement is partially excluded. The new law does not include natural disasters as a particular situation.

Abernathy said he was convinced that judges would be lenient. “I can not imagine, judges demanding paperwork when he prevailed.” But he said, difficult people in affected areas are located above the median income (about $ 53500 for a family of four people in Louisiana) and “intended to cover the costs should not be able to go away from their debts. ”

The new law critics say it is too localities where a burden on victims of the hurricane, there is little time after all, it is effective, though many of its rules must be tested.

The victims of Katrina “is the first guinea pigs by the bankruptcy system,” said Elizabeth Warren, a Harvard Law professor and critic of the new law. “Some of these people are able to convince the courts that new laws have been unnoticed flexibility, but it costs time and money to compete in these issues. Survivors of the disaster, either.”

Bradford W. Botes, a lawyer, whose bankrupt company has several branches in the south, firstly that most victims of Katrina will not think once the bankruptcy.

But in four months or more, he said, if creditors asked if payments and the victims are yet to find employment or jobs, pay what they were before the storm, bankruptcy will appear as an attractive option, Botes said.

It is not only Katrina victims, will focus on bankruptcy, said Botes, but also the highest consumers of gasoline and heating. “If it is already on a narrow line, then it slips,” he said.