United States Supreme Court Upholds Debtors Rights in Chapter 13 Bankruptcy
Because of a lot of recent legal developments, notably the 2005 bankruptcy amendments, many people feel like the terms of bankruptcy are being skewed away from helping working people stuck in debt to protecting big banks and creditors from losing profits. However a new Supreme Court case, Hamilton v. Lanning, upholds the opposite view—it reaffirms protection and leniency for debtors in their Chapter 13 payments.
A Chapter 13 bankruptcy allows an individual to reorganize their debts into a monthly payment plan that seems fair to everyone involved—debtors, creditors, and bankruptcy trustees. A Chapter 13 bankruptcy is supposed to allow monthly Chapter 13 payments which are affordable and is determined by the debtor's income, among other criteria. In Hamilton v. Lanning, the debtor in this case, did not have a high income, but was paid a large short-term sum from a former employer. Her creditors abused the facts of her situation to argue for a much larger Chapter 13 payment than she could possibly pay. The Supreme Court, in an 8-1 decision with Justice Scalia dissenting, supported the debtor's view that her Chapter 13 payments should not be based off her temporarily inflated monthly income, but by her normal expected income.
The Supreme Court shows that bankruptcy understands the needs of debtors when considering Chapter 13 payments--a lot more than people think. While creditors want to get the most money possible from a debtor and will abuse the facts to do so—this case has proved that the end result of a bankruptcy should be in the best interest of you, the debtor.
Everyone who is considering a Chapter 13 bankruptcy will welcome this development. This only confirms the fact that bankruptcy exists to help working families get back to solid ground. This additionally proves the strength of a great Chapter 13 bankruptcy lawyer. While you are able to file a Chapter 13 bankruptcy by yourself, you really should consider the benefits that a bankruptcy attorney can provide. Any bankruptcy lawyer worth their salt will follow the most recent cases in bankruptcy law so that they can get you the most fair Chapter 13 payments.
What should you look for in a good bankruptcy lawyer? Do your research! Try to find a bankruptcy lawyer that offers free materials on every new part of Chapter 13 bankruptcy law. Any bankruptcy attorney that takes seriously informing their clients about every step of a bankruptcy is a lawyer with your interests in mind. And, fortunately, so does the U.S. Supreme Court!
About the Author
Missouri bankruptcy attorney Jim Brown is the owner and founder of Castle Law Office in St. Louis, Missouri. He has written five consumer guides, including his immensely popular debt relief guide, "Get Out of Debt: Secrets Your Creditors Don't Want You to Know." To request a free copy of the book or just get more information on bankruptcy, you can visit his website at http://www.CastleLaw.net .
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