Bankruptcy

Poster Children for Bankruptcy Reform

By Bill McLeod, Esq.

There has been so much written about BAPCPA and the creditors who practically wrote the law and got it passed. While I cannot doubt that creditors ? such as the good folks at MBNA (which was bought out by Bank of America), paid their lobbyists millions of dollars for years to get the Bankruptcy Code changed, a recent case perhaps rightly suggested that lenders had good reason to seek a change in the law. The case, decided in February, came out of the Northern District of Alabama.

The husband and wife debtors filed their case in October 2006. It was the wife?s seventh bankruptcy case (no that?s not a typo....that's 7) and the husband?s fifth (and again, not a typo....that's 5). As the October filing was their second case within a year, they filed a motion to seek an extension of the automatic stay. Since 2005, if a debtor has had a case pending within the year prior to the case being filed, the stay expires 30 days unless the court orders otherwise. The hearing of the motion must be held within the 30 day period. The debtors needed the stay to prevent a foreclosure on their home.

Full post as published by McLeod Law Offices on April 08, 2008 (boomark / email).