New Bankruptcy bill - paying MBNA more important than child support

[CAMANY]

Read this on another forum in regards to the bankruptcy bill - anyone know anything about it?

"Actually, what they were most likely referencing was the portion of the act that puts child support payments as equal to credit card debt. Before, the child support payments got top priority. Now the single mom raising 2 kids will have to compete with companies like Chase and MBNA to get money to feed her kids. "

Glad to see the republicans care about the kids oh so much.

[nadinbrzezinski]

1. It is true

that was one of the many reforms that were offered and shot down.. my personal favorite, (Not) the weakening of the protections for troops who have gone to war... my hubby is a vet... and I cuold only think of the many women and men who send their SOs to war... and their income suddenly drops and walla, suddenly they are in credit card hell

[LostinVA]

4. My BIL went to Bosnia then Kuwait for almost a year

My sister could no longer work 40 hours as a nurse (her kids were too little). Long story short: their house was foreclosed on, they lost their car, and had to declare Chapter 7. This was in Fayetteville/Ft. Bragg. No one cared then. The only difference was, the cc debt she had from medical bills, groceries, utilities, etc. was wiped clean. Now?

[DavidFL]

2. Because child support is non-dischargeable debt...

meaning it can't be eliminated by filing for bankruptcy, as are federally-insured student loans and certain other debts covered by 11 USC Sec. 524. Congress fixed that awhile back to prevent the non-custodial parent from avoiding child support by going to bankruptcy court right after, or soon after, they left divorce/family court.

I haven't read the final version of the bill passed yesterday by Congress, but earlier versions I've seen corraled those who passed a means test -- which, from my understanding, could be as little as $100 in discretionary income per month -- into Ch. 13 instead of Ch. 7. This is an oversimplification of the process, but the basic difference between the two is that in Ch. 7, all of a debtor's dischargeable debt is wiped out when the court grants the petition. In Ch. 13, you create a plan to make monthly payments to your creditors for up to 5 years, after which, all of the debtor's remaining dischargeable debt is eliminated.

With respect to child support, under the old law, some people would have been able to do Ch. 7 and free up their income allowing them to, for example, catch up on back child support, or increase their payments. Under this new law, child support payments must compete with credit card debt in a Ch. 13 plan so that both the custodial parent and the credit card company must receive monthly payments. And it in some cases, there might have to be a temporary downward modification of the child support payments in order to accommodate credit card debt payments.

On edit: just realized my post might have implied that this new bill makes credit card debt non-dischargeable, like child support, which it does not. Credit card debt will still be dischargeable after a Ch. 13 plan is completed, but during the time period of the plan, it will compete with child support and other debts for a share of the debtor's monthly payments. Sorry for any confusion.

[NVMojo]

3. Sickening! Sickening! These bastards need to quit calling themselves

"Christians" for they are nothing but henchmen and women of Hypocrisy!