All over America, people are charging up credit cards and spending more money than they may have at the time. Sometimes this results in not being able to cover their monthly payments and before they are handed over to debt collectors, some people file for bankruptcy. Bankruptcy does not mean that you have failed; it simply means that you cannot fulfill your financial obligations at this time.

The new bankruptcy law went into effect in the spring of 2005. The new law differs from the old law in that it requires two additional steps for the debtor to complete the process. One step requires a person filing bankruptcy will have to attend an approved Credit Counseling Course within the 6 months before the debtor completes the filing process. Any bankruptcy lawyer can set this course of action for the debtor. In some cases the course can be taken over the Internet. In step two the debtor must attend and complete an approved Financial Management Course before the debt discharge can proceed. In this step, the bankruptcy lawyer can set up this second requirement for the new law.

Another item in the new law will test a person's finances for approval in bankruptcy proceedings. There are three tests that will evaluate personal income, and to check total family earning and income for a specific state of residence. These tests will check a debtor's eligibility for bankruptcy. The debtor will additionally have to provide proof of income as well. The mentions that debtors filing Chapter 7 or Chapter 13 bankruptcy, must provide to the trustee, a copy of a tax return or transcript of a tax return, for the period for which the return was most recently done. The new law also mentions that a debtor cannot use state exemptions unless residence has reached a total of at least 2 years. Additionally, the homestead exemption has changed with the new law. A qualified bankruptcy lawyer can provide further details on the law and the process.

There are people who are living beyond their means and they seek help first from bankruptcy attorneys who then suggest counseling or financial aid institutions that can help consolidate your debt. If these people live in California, debtors have the option of being protected under the California state home exemption and may be able to protect all proceeds if you sell your home a year before you file bankruptcy.

In Oakland, if you are 65 or older, disabled, or are 55 or older and live off of less than fifteen thousand dollars a year, you can be protected up to $150,000 in debt. There are many laws in Oakland, and the whole state of California for that matter, that may protect your assets and other properties ? monetary as well ? during the time you have declared bankruptcy. Lawyers in Oakland are extremely informative and helpful and wish to provide you with the best protection and service there is to offer. No matter what state you live in there it is best to speak to a bankruptcy attorney who can help you decide on the best action for your situation.