New bankruptcy law a problem for Katrina victims - Sep. 1, 2005

New Bankruptcy Law Will Kick Katrina Survivors When They're Down.

Katrina's coming. You run out of your house with your bills barely paid, $100 and a credit card in your pocket, pack the family up and head north to any place dry. In a Motel 6 in Tennessee, you realize that your home and everything in it have been destroyed - your other car too. You don't have a job anymore because the place where you worked was destroyed and there's no job to go to. What do you do? You can't even file bankruptcy in your home district because the bankruptcy court is underwater, you can't get to a lawyer, and you aren't there. Moreover, things are bound to get worse before they get better. So you wait. Suddenly it's October 18. You can't file for Chapter 7 bankruptcy. Your (documented) income is higher than national average - before you file bankruptcy they want you to go through credit counseling - without a permanent address or job - and they want you to make payments to your creditors for 7 years on a house and car that you no longer have. That's what they call bankruptcy "reform" in 2005.



New bankruptcy law a problem for Katrina victims - Sep. 1, 2005