The most widely held misconception about bankruptcy is that it’s the debtor’s version of the “get out of jail free” card in Monopoly. While most people know that bankruptcy affects your credit for 7 to 10 years, very few people know that it’s possible that you’ll have to pay back the debt anyway, even if you file a Chapter 7 “straight” bankruptcy. The formal definition of bankruptcy is “a proceeding in federal court in which an insolvent debtor’s assets are liquidated and the debtor is relieved of further liability.” On the other hand, the commonplace definition of bankruptcy is probably “the process of completely wiping out your debts for free.” In the majority of cases, the latter definition may be appropriate, but in some scenarios, it’s likely that even with bankruptcy, you’ll still have to pay back at least a portion of the debt.
So when is it likely that you’ll have to pay back your debts? Here are the most common scenarios when you’ll get all the negatives of filing bankruptcy (severe credit impact for 7 to 10 years), but none of the benefits (you’ll still have to pay back at least part of the debt):
1) You make more than the average person in your state. If this is the case, then it’s likely that you’ll be forced into a Chapter 13 bankruptcy plan. In a Chapter 13 bankruptcy, the court orders that you pay all your disposable income to a court appointed trustee, who in turn disburses payments to your creditors. Keep in mind that the court determines your disposable income by national and county statistics on average necessary expenses, not what you’re paying. So just because you’re paying a lot for a car doesn’t mean the court will approve it. There are numerous cases when a judge ordered families to stop sending their children to private schools so they can have more money to pay back their creditors. In Illinois, here are the latest statistics on the Illinois median income by size of household:
Illinois Estimate
1-person families 41,650
2-person families 52,891
3-person families 62,176
4-person families 72,368
2) You have assets. If you own a home or car, then it’s possible that the bankruptcy court will force you to sell them to generate sufficient cash to pay back your creditors. Chances are if have a good chunk of change invested (unless it’s in a tax-exempt account like an IRA) then you’ll also be forced to liquidate it. If you have a second home or another vehicle (assuming you own both completely), then you’re really out of luck. Fortunately, there are some safeguards to protect consumers from bankruptcy hell. In Illinois, every resident is entitled to at least $7,500 of the value of their home, $1200 of the value of their vehicle, and $2,000 for anything that they want (known as the wildcard exemption). Also, these values double if you’re married (assuming the property is in both of your names).
What does this actually mean? Consider the following example.
Let’s say you have a house that’s worth $250,000, and it’s in both yours and your wife’s name. You still owe about $200,000 on your mortgage, and you decided to file Chapter 7 bankruptcy. In this example, you would be forced to sell your home, and with the proceeds you would pay back the mortgage company what you owe on the outstanding balance of the loan ($200,000), you’d pay yourself the Illinois real estate exemption ($15,000), and then you’d pay back your other creditors whatever was left ($250K-200K-15K=$35,000).
Let say your house was only worth $215,000, but everything else in the above example remained the same. In this case, you wouldn’t be forced to sell your home because the proceeds from the sale wouldn’t amount to anything after you paid back the mortgage company and then paid back yourself the Illinois real estate exemption.
3) The creditors can prove that you were fraudulent and never had any intention of paying them back.
For the majority of us it means that unless a) you don’t have a lot of equity in any of your property, b) you don’t have any investments like stocks, real estate, ect., c) you don’t care about having to sell anything mentioned in points a and b, or d) you don’t care about having to give up your disposable for 5 years in a Chapter 13, then bankruptcy may not be your best option.
http://www.articlefrenzy.com/Article/Will-You-Have-to-Pay-Back-the-Debt-Anyway-/62103
Friday, September 7, 2007
Is it possible to remove bankruptcy
Faqs on Bankruptcy Part1
Any negative listing can be removed from a credit report if it is erroneous, questionable and disputable. However, negative items such as bankruptcy and unpaid debts are more difficult to remove from the credit report. This is primarily due to the operational systems of the credit bureaus rather than with the severity of the bad credit item such as bankruptcy or unpaid debt. For example, judgments and tax liens are also severely negative listings yet have been considerably easier to remove. Credit repair is a good option.
Does bankruptcy wipe the slate clean for a second chance?
The bankruptcy does appear on your credit record in the court records section. When you file for bankruptcy, every credit account that you decide to include in bankruptcy becomes an "included in bankruptcy" account. Because so many negative items are attached to the bankruptcy, it becomes very difficult to remove all trace of that bad credit.
During Bankruptcy improving credit score is a good option
What can I do to contest entries on my credit report?
There are three common ways to repair
credit report: 1) hire a lawyer, 2) hire a credit counseling company, or 3) do-it-yourself. Hiring a lawyer can be extraordinarily expensive at rates of over $300 per hour. Hiring a credit counseling company typically costs upwards of $1,500, and can be risky as there are many credits counseling companies with shaky reputation which make big promises, but in reality just take advantage of customers without delivering real results. That is why the Federal Trade Commission has issued a consumer warning on this topic and has strongly suggested to consumers to adopt a do-it-yourself approach. The issue until now has been that there were no comprehensive resources as to what exactly you need to do as a consumer to correct your credit report.
http://www.articlefrenzy.com/Article/Is-it-possible-to-remove-bankruptcy/63728
Any negative listing can be removed from a credit report if it is erroneous, questionable and disputable. However, negative items such as bankruptcy and unpaid debts are more difficult to remove from the credit report. This is primarily due to the operational systems of the credit bureaus rather than with the severity of the bad credit item such as bankruptcy or unpaid debt. For example, judgments and tax liens are also severely negative listings yet have been considerably easier to remove. Credit repair is a good option.
Does bankruptcy wipe the slate clean for a second chance?
The bankruptcy does appear on your credit record in the court records section. When you file for bankruptcy, every credit account that you decide to include in bankruptcy becomes an "included in bankruptcy" account. Because so many negative items are attached to the bankruptcy, it becomes very difficult to remove all trace of that bad credit.
During Bankruptcy improving credit score is a good option
What can I do to contest entries on my credit report?
There are three common ways to repair
credit report: 1) hire a lawyer, 2) hire a credit counseling company, or 3) do-it-yourself. Hiring a lawyer can be extraordinarily expensive at rates of over $300 per hour. Hiring a credit counseling company typically costs upwards of $1,500, and can be risky as there are many credits counseling companies with shaky reputation which make big promises, but in reality just take advantage of customers without delivering real results. That is why the Federal Trade Commission has issued a consumer warning on this topic and has strongly suggested to consumers to adopt a do-it-yourself approach. The issue until now has been that there were no comprehensive resources as to what exactly you need to do as a consumer to correct your credit report.
http://www.articlefrenzy.com/Article/Is-it-possible-to-remove-bankruptcy/63728
Foreclosure listings are valuable guides to good investments.
Nowadays it’s not uncommon for people to have trouble paying off their mortgage loans. In these situations the creditor, usually a bank, initiates a procedure in order to recover its losses. This procedure is commonly known as a bank foreclosure and is often seen as a very good buying opportunity. If you are considering purchasing foreclosed property you should first get a look at some foreclosure listings, as they can be very valuable guides. Choose the source of your information wisely and remember that the free foreclosure listings are not always the best. At foreclosureconnections.com we welcome you to consider some of our foreclosure listings.
Finding a good property foreclosure bargain requires a careful analysis of the real estate market. There are several sources available to those interested in finding foreclosure listings. These sources include local news papers, lending institutions, financial institutions, realtors and government agencies. The internet is also a very complete source of foreclosed property listings and an especially practical one as well. Foreclosure listings services give you access to great bargains all over the country. Many websites advertise free foreclosure listings and although it sounds tempting remember, it’s just another way to allure customers. Free foreclosure listings are usually not the most professional listings out there. Find out more about what a professional website can do for you at foreclosureconnections.com.
When searching for a good deal on a foreclosed property it’s crucial to be well informed. Finding the most accurate foreclosure listings source is essential. However, it’s also very important that you do your research well after you’ve chosen the property of your dreams. In order to avoid any unpleasant surprises you should look into the rightful ownership of the specific property before making any decisions. When dealing directly with the owner you might want to make sure that he really has rightful ownership of the property. It’s also a good idea to inspect the property yourself before committing to any purchase. There are quite a few cases where the property described in a listing doesn’t quite match the reality of things. Of course, this can be avoided if you choose a trustworthy listings provider with a reputation for having only the most accurate information. Reputable lists and a team of professionals is what you will find at foreclosureconnections.com
Most of the time bank foreclosures are the result of unpaid mortgage loans. Lenders usually initiate default procedures after the third payment of a loan secured by real estate has been missed. Pre-foreclosure property is a common term used for homes which have not been yet seized by the lender. However, with pre-foreclosures the owner faces the possibility of having the property taken away because of his failure to make the payments. Some of the seasoned investors especially look for those homes where the owner has failed to pay off his loan for a long time and is very eager to get rid of the financial complications involved in owning the property. If the situation of the loan hasn’t been settled in the pre-foreclosure period, the loaner will take ownership of the property. You should know that it’s not in the best interest of the loaner to maintain the state of ownership for a long time, as it brings him no profit. The immediate time after the lender has taken over the property is considered to be the best time to purchase a foreclosure. Remember to make sure you have complete and accurate information about the foreclosed property before closing any deals.
Bank foreclosures are generally considered to be solid investments. A foreclosed property can be bought at a very good price and afterwards sold at its real market value. Investing in foreclosures can turn out to be very profitable if you do your planning carefully. Although many free foreclosure listings are available you might want to take your foreclosure listings form a professional if you want to profit from the investment.
http://www.articlefrenzy.com/Article/Foreclosure-listings-are-valuable-guides-to-good-investments-/85250
Finding a good property foreclosure bargain requires a careful analysis of the real estate market. There are several sources available to those interested in finding foreclosure listings. These sources include local news papers, lending institutions, financial institutions, realtors and government agencies. The internet is also a very complete source of foreclosed property listings and an especially practical one as well. Foreclosure listings services give you access to great bargains all over the country. Many websites advertise free foreclosure listings and although it sounds tempting remember, it’s just another way to allure customers. Free foreclosure listings are usually not the most professional listings out there. Find out more about what a professional website can do for you at foreclosureconnections.com.
When searching for a good deal on a foreclosed property it’s crucial to be well informed. Finding the most accurate foreclosure listings source is essential. However, it’s also very important that you do your research well after you’ve chosen the property of your dreams. In order to avoid any unpleasant surprises you should look into the rightful ownership of the specific property before making any decisions. When dealing directly with the owner you might want to make sure that he really has rightful ownership of the property. It’s also a good idea to inspect the property yourself before committing to any purchase. There are quite a few cases where the property described in a listing doesn’t quite match the reality of things. Of course, this can be avoided if you choose a trustworthy listings provider with a reputation for having only the most accurate information. Reputable lists and a team of professionals is what you will find at foreclosureconnections.com
Most of the time bank foreclosures are the result of unpaid mortgage loans. Lenders usually initiate default procedures after the third payment of a loan secured by real estate has been missed. Pre-foreclosure property is a common term used for homes which have not been yet seized by the lender. However, with pre-foreclosures the owner faces the possibility of having the property taken away because of his failure to make the payments. Some of the seasoned investors especially look for those homes where the owner has failed to pay off his loan for a long time and is very eager to get rid of the financial complications involved in owning the property. If the situation of the loan hasn’t been settled in the pre-foreclosure period, the loaner will take ownership of the property. You should know that it’s not in the best interest of the loaner to maintain the state of ownership for a long time, as it brings him no profit. The immediate time after the lender has taken over the property is considered to be the best time to purchase a foreclosure. Remember to make sure you have complete and accurate information about the foreclosed property before closing any deals.
Bank foreclosures are generally considered to be solid investments. A foreclosed property can be bought at a very good price and afterwards sold at its real market value. Investing in foreclosures can turn out to be very profitable if you do your planning carefully. Although many free foreclosure listings are available you might want to take your foreclosure listings form a professional if you want to profit from the investment.
http://www.articlefrenzy.com/Article/Foreclosure-listings-are-valuable-guides-to-good-investments-/85250
A guide to going Bankrupt in Real Estate!!!
There have been a lot of books and late night infomercials on how to become rich through real estate. Apparently, you can become rich overnight. Neat. But, no one has really written a good guide on how to go bankrupt. Sure everyone is doing it, but how can you get in on the action.
First off, watch some late night infomercials on TV. And possibly order some real estate tapes from Carlton Sheets. This will provide you with a positive upbeat attitude and a sense of false confidence that is essential in order to go bankrupt. Believe that after listening to some tapes, you can compete with people that have done this 7 days a week for years.
Second. For your first investment, buy in a city you know little to nothing about and avoid using a buyers agent who does know the city. Go directly to the sellers agent. The best way to make a truly horrible decision is to avoid any outside advice. The best part of this is that avoiding a buyers agent usually doesn't save you any money since the selling agent simply makes more when you deal with them directly.
Look for a discount or a distressed property over a good long term investment. Late night infomercials and Carlton Sheets talk a lot about this. Getting equity at the point of sale. One thing about distressed properties with desperate sellers is that they frequently are in crappy areas with low appreciation rates. Buying a property at under market rate in an area with low appreciation potential versus a property in a good area is the kind of short sighted thinking that will really help you reach the goal of bankruptcy and foreclosure.
When you talk to people including your realtor, try to spend time talking about all the crap you learned from your book or light night infomercial. The more you listen to other people, the more you might get different perspectives and the higher chance you might learn new things. This could really hurt your chances of going bankrupt so avoid listening to anyone. Remember you know everything even if you only got interested in real estate last week.
Be positive to the point of stupidity. Alot of investors I know always think about how their situation would be affected by a 10 or 20 percent drop in the market before making a purchase. You should avoid this kind of thinking. You need to be blinded by greed. You should only fantasize about how you are going to double your money.
When calculating your monthly cashflow, assume that you will have 100% occupancy all the time and no maintenance cost. While you are at assume that its going to rain money tomorrow.
Also, be stubborn when renting your properties. Decide upon a number say $900 a month and refuse to budge. Come up with some bizarre logic about how the property deserves $900 a month. Lose months of rent having the property sit vacant instead of going down $50 on the rent. Instead of responding to the market make statements like "Well the markets wrong then".
As you move closer to foreclosure, don't alter your spending habits. Don't move into a smaller house or cut spending. Act like nothing is wrong.
Overextend, overextend, overextend. Are you approved to buy one house. Why not buy 5, heck why not 20. Instead of building up a portfolio of properties over time, gaining experience along the way, just buy alot of properties next Tuesday.
Alot of people are getting into the foreclosure game. Their is no reason you should be left behind. Throwing caution to the wind and filling your eyes with greed and you should find yourself walking down the golden path to foreclosure.
This is not a definitive guide to foreclosure. Alot of people end up in foreclosure due to many things unforeseen events like unpreventable family illness, divorce or job loss. This is simply a guide to what I call elective foreclosure.
http://www.articlefrenzy.com/Article/A-guide-to-going-Bankrupt-in-Real-Estate---/97598
First off, watch some late night infomercials on TV. And possibly order some real estate tapes from Carlton Sheets. This will provide you with a positive upbeat attitude and a sense of false confidence that is essential in order to go bankrupt. Believe that after listening to some tapes, you can compete with people that have done this 7 days a week for years.
Second. For your first investment, buy in a city you know little to nothing about and avoid using a buyers agent who does know the city. Go directly to the sellers agent. The best way to make a truly horrible decision is to avoid any outside advice. The best part of this is that avoiding a buyers agent usually doesn't save you any money since the selling agent simply makes more when you deal with them directly.
Look for a discount or a distressed property over a good long term investment. Late night infomercials and Carlton Sheets talk a lot about this. Getting equity at the point of sale. One thing about distressed properties with desperate sellers is that they frequently are in crappy areas with low appreciation rates. Buying a property at under market rate in an area with low appreciation potential versus a property in a good area is the kind of short sighted thinking that will really help you reach the goal of bankruptcy and foreclosure.
When you talk to people including your realtor, try to spend time talking about all the crap you learned from your book or light night infomercial. The more you listen to other people, the more you might get different perspectives and the higher chance you might learn new things. This could really hurt your chances of going bankrupt so avoid listening to anyone. Remember you know everything even if you only got interested in real estate last week.
Be positive to the point of stupidity. Alot of investors I know always think about how their situation would be affected by a 10 or 20 percent drop in the market before making a purchase. You should avoid this kind of thinking. You need to be blinded by greed. You should only fantasize about how you are going to double your money.
When calculating your monthly cashflow, assume that you will have 100% occupancy all the time and no maintenance cost. While you are at assume that its going to rain money tomorrow.
Also, be stubborn when renting your properties. Decide upon a number say $900 a month and refuse to budge. Come up with some bizarre logic about how the property deserves $900 a month. Lose months of rent having the property sit vacant instead of going down $50 on the rent. Instead of responding to the market make statements like "Well the markets wrong then".
As you move closer to foreclosure, don't alter your spending habits. Don't move into a smaller house or cut spending. Act like nothing is wrong.
Overextend, overextend, overextend. Are you approved to buy one house. Why not buy 5, heck why not 20. Instead of building up a portfolio of properties over time, gaining experience along the way, just buy alot of properties next Tuesday.
Alot of people are getting into the foreclosure game. Their is no reason you should be left behind. Throwing caution to the wind and filling your eyes with greed and you should find yourself walking down the golden path to foreclosure.
This is not a definitive guide to foreclosure. Alot of people end up in foreclosure due to many things unforeseen events like unpreventable family illness, divorce or job loss. This is simply a guide to what I call elective foreclosure.
http://www.articlefrenzy.com/Article/A-guide-to-going-Bankrupt-in-Real-Estate---/97598
Does Bankruptcy Ruin Your Credit Forever?
Personal bankruptcy rates fluctuate, but always remain at fairly high levels. If you have gone through bankruptcy and are finally serious about getting your credit and finances in order, you may be wondering how long it will take for your credit rating to get back to a level where you can get better interest rates on mortgages and car loans.
If people have had poor actions that have led them down the path of bankruptcy, all is not lost. Credit repair after bankruptcy is not only possible, it's critical for the individual to accomplish or they will continue to only tread water. Bankruptcy allows people to have a new fresh start by wiping all of the debt away and begin to project a positive credit history.
It is not a good idea to immediately apply for unsecured lines of credit. You are likely to get rejected at best, which will show up on your credit history, and keep your credit score low. You might get accepted, but you will probably pay much higher fees and interest rates. One thing to consider is getting a secured credit card, where your credit line is determined by depositing cash into your account as collateral.
Even with good use of your finances, it can up to ten years to get your credit back to a normal level. It may seem like a long time, but the benefits can be tremendous in terms of money saved. And when you consider that you have just had your big debt balances erased by bankruptcy, this is still a better situation than before your bankruptcy.
How To Repair Your Credit After Bankruptcy
Now don't hit your computer screen, but now that you are starting over, it is a great time to get a realistic financial picture, and that includes making a budget. I know, it makes my eyes glaze over, but once I knew where my money was going, I could make my financial goals come true. Without it you will just drift and make no progress.
Secondly, be sure to pay yourself first. Put money aside so you cannot easily get to it. Then plan out your purchases. Sure, have a little cash for impulse buys, but if you stay disciplined, you can avoid most of them as you see your finances improve and you feel the sense of accomplishment and independence your are achieving.
If impulse buying was what got you into trouble before, find a way to short circuit that tendency. Aren't at least a little mad at yourself and the finance companies for your previous debt problems? Resolve to keep them out of your life this time. One good trick is to wait a day to buy that thing you think you just have to have. You will find that almost always the urge goes away.
Lastly, find a spiritual outlet. Get in touch with that part of you that knows more things won't bring you lasting satisfaction. As you resolve to live more genuinely, and treat your finances more maturely, your credit will automatically improve after your bankruptcy, and before you know it, your credit score will be back toward normal.
http://www.articlefrenzy.com/Article/Does-Bankruptcy-Ruin-Your-Credit-Forever-/100587
If people have had poor actions that have led them down the path of bankruptcy, all is not lost. Credit repair after bankruptcy is not only possible, it's critical for the individual to accomplish or they will continue to only tread water. Bankruptcy allows people to have a new fresh start by wiping all of the debt away and begin to project a positive credit history.
It is not a good idea to immediately apply for unsecured lines of credit. You are likely to get rejected at best, which will show up on your credit history, and keep your credit score low. You might get accepted, but you will probably pay much higher fees and interest rates. One thing to consider is getting a secured credit card, where your credit line is determined by depositing cash into your account as collateral.
Even with good use of your finances, it can up to ten years to get your credit back to a normal level. It may seem like a long time, but the benefits can be tremendous in terms of money saved. And when you consider that you have just had your big debt balances erased by bankruptcy, this is still a better situation than before your bankruptcy.
How To Repair Your Credit After Bankruptcy
Now don't hit your computer screen, but now that you are starting over, it is a great time to get a realistic financial picture, and that includes making a budget. I know, it makes my eyes glaze over, but once I knew where my money was going, I could make my financial goals come true. Without it you will just drift and make no progress.
Secondly, be sure to pay yourself first. Put money aside so you cannot easily get to it. Then plan out your purchases. Sure, have a little cash for impulse buys, but if you stay disciplined, you can avoid most of them as you see your finances improve and you feel the sense of accomplishment and independence your are achieving.
If impulse buying was what got you into trouble before, find a way to short circuit that tendency. Aren't at least a little mad at yourself and the finance companies for your previous debt problems? Resolve to keep them out of your life this time. One good trick is to wait a day to buy that thing you think you just have to have. You will find that almost always the urge goes away.
Lastly, find a spiritual outlet. Get in touch with that part of you that knows more things won't bring you lasting satisfaction. As you resolve to live more genuinely, and treat your finances more maturely, your credit will automatically improve after your bankruptcy, and before you know it, your credit score will be back toward normal.
http://www.articlefrenzy.com/Article/Does-Bankruptcy-Ruin-Your-Credit-Forever-/100587
Bankruptcy Codes And You
Even though most people don't consider themselves at a financial risk for bankruptcy, the sad statistics are that today more and more people are heading that direction. In fact, the various forms of bankruptcy such as chapter 7, chapter 13, and even chapter 11 are becoming a more popular financial out for people and businesses each and every day.
The U.S. bankruptcy laws were put in place by Congress in order to provide uniformity to the code and statutes throughout the United States. The bankruptcy laws were actually put in place to protect people from doing further financial harm.
Currently there are four different sections or chapters to the bankruptcy statutes. For instance, you'll probably recognize such bankruptcy terminology as chapter 11... which is the section of bankruptcy code that can be found in chapter 11 of the statute.
The different bankruptcy chapters such as the ones mentioned above are the details to the various statutes of the bankruptcy codes (such as chapter 7). Each of the various chapters have their own particular nuances as to how the financial burden is relieved and what procedures must be followed in order for that debt to be relieved. In addition there are also stipulations and regulations set forth that the involved creditors must abide by.
Even though there are Federal bankruptcy statutes that each state must follow, each state can still pass its own laws concerning the execution of the bankruptcy proceedings. This as long as these local state laws still fit within the framework of the Federal. In other words, states have the power to establish law concerning bankruptcy but not complete autonomy in doing so.
Even though the individual states can't alter the basic intent of the federal bankruptcy laws, the do have the right to interpret how the claims should be filed and how they are acted upon by the individual states themselves.
Just like most any statute, the bankruptcy codes are dynamic and subject to change. This is why it is imperative that an individual seeks the counsel of a professional bankruptcy attorney.
Any change to the base bankruptcy laws of the U.S. will be originated from Congress itself. An example of such came with the filing requirements of a Chapter 7 bankruptcy. This particular changed effected the primary rules for the filing in that it added additional burden of proof on the person filing to have met the specific criteria and as such would have the right to file for bankruptcy.
Because of the influx of people entering the bankruptcy system, this type of change to the core bankruptcy statutes was put in place. Now, across all states, if someone is seeking bankruptcy protection under the law; they are required to complete a court appointed financial and bankruptcy counseling session. This was done to help protect the system and creditors from those who just wanted not to pay off their debts.
http://www.articlefrenzy.com/Article/Bankruptcy-Codes-And-You/108390
The U.S. bankruptcy laws were put in place by Congress in order to provide uniformity to the code and statutes throughout the United States. The bankruptcy laws were actually put in place to protect people from doing further financial harm.
Currently there are four different sections or chapters to the bankruptcy statutes. For instance, you'll probably recognize such bankruptcy terminology as chapter 11... which is the section of bankruptcy code that can be found in chapter 11 of the statute.
The different bankruptcy chapters such as the ones mentioned above are the details to the various statutes of the bankruptcy codes (such as chapter 7). Each of the various chapters have their own particular nuances as to how the financial burden is relieved and what procedures must be followed in order for that debt to be relieved. In addition there are also stipulations and regulations set forth that the involved creditors must abide by.
Even though there are Federal bankruptcy statutes that each state must follow, each state can still pass its own laws concerning the execution of the bankruptcy proceedings. This as long as these local state laws still fit within the framework of the Federal. In other words, states have the power to establish law concerning bankruptcy but not complete autonomy in doing so.
Even though the individual states can't alter the basic intent of the federal bankruptcy laws, the do have the right to interpret how the claims should be filed and how they are acted upon by the individual states themselves.
Just like most any statute, the bankruptcy codes are dynamic and subject to change. This is why it is imperative that an individual seeks the counsel of a professional bankruptcy attorney.
Any change to the base bankruptcy laws of the U.S. will be originated from Congress itself. An example of such came with the filing requirements of a Chapter 7 bankruptcy. This particular changed effected the primary rules for the filing in that it added additional burden of proof on the person filing to have met the specific criteria and as such would have the right to file for bankruptcy.
Because of the influx of people entering the bankruptcy system, this type of change to the core bankruptcy statutes was put in place. Now, across all states, if someone is seeking bankruptcy protection under the law; they are required to complete a court appointed financial and bankruptcy counseling session. This was done to help protect the system and creditors from those who just wanted not to pay off their debts.
http://www.articlefrenzy.com/Article/Bankruptcy-Codes-And-You/108390
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