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Debt Management Experts Warns Consumers: “Choose Debt Management Options Carefully In Light Of Pending Changes in Bankruptcy Laws”

(PRLEAP.COM) Date: Thursday — May 12, 2005 - With the recent changes in the bankruptcy laws many Americans feel a heightened sense of urgency to address their debt. The politicians in Washington are clearly bent on taking control out of the hands of average Americans and putting decisions about their finances in the control of credit card companies. The new laws remove discretion from the debtor to choose the form of bankruptcy they prefer and instead rely on simplistic ‘tests’ and ‘formulas’” to make that determination. The new laws also allow the creditors more leverage to contest decisions that were assigned to bankruptcy trustees.

According to Kenneth Priore, an attorney in California and a principal in a professional debt solutions company, New Leaf Financial, “Congress and the president have made a grave mistake in making bankruptcy a ‘one-size-fits-all’ solution.” Mr. Priore went on to ad, “People shouldn’t make the same mistake by rushing into any course of action to resolve their debts.”

There are a myriad of options available to consumers. Credit counseling, debt settlement and equity loans all have a unique set of advantages and disadvantages and the consumer must understand these differences before making any decisions.

Mr. Priore further went on to outline the various options facing consumers. Credit counseling is the most traditional and conservative solution and may be an appropriate fit for those searching for a solution that is the least confrontational and easiest to implement. Mr. Priore noted, “Remember that credit counseling was started many years ago in concert with credit card companies…though it may lower your interest rates, and consolidate your bills to one payment, those are about the only advantages.”

Mr. Priore went on to discuss the attributes of debt settlement, a more aggressive approach which can lower the overall cost of the debt. “Debt settlement leaves financial control in the hands of the debtor; they can look at their finances and make the decision on how much they have to resolve their debt.” But Mr. Priore notes that this solution is not for everyone, “It takes someone willing to make a personal commitment to take advantage of this more aggressive option.”

Finally, Mr. Priore offered his viewpoint on equity financing, “The use of home equity to pay off unsecured debt is an option, and a very good one when the loss of income prevents utilizing another method of debt relief. Using equity to solve other debts puts your home and long-term financial health at greater risk.”

Before founding New Leaf Financial, Priore was a managing attorney for a third party litigation group for Charles Schwab, Inc. and counsel and chief compliance office to MVC Capital. Priore received his BA from Tufts University in 1991 and his JD from Tulane University in 1995.

CONTACT INFORMATION
Christopher Osborn
New Leaf Debt Settlement
Email New Leaf Debt Settlement
(415)526-1135

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Debt Management Expert Voices Opposition To New Law: “New Bankruptcy Law Hurts Rather Than Helps”

(PRLEAP.COM) President Bush has signed into law a measure that will deter tens of thousands from filing bankruptcy under Chapter 7 bankruptcy.

According to Kenneth Priore, an attorney in California and a principal in a professional debt negotiation company, New Leaf Debt Settlement, “This law goes too far, instead of punishing a few bad actors, it is a direct slap in the faces of thousands of average wage earning Americans. This means test hurts doesn’t catch just the bad apples but hard working wage earners.” Debtors will now be required to seek credit counseling before they can take advantage of bankruptcy protections. The law also requires full financial disclosure and authorizes a bankruptcy trustee to decide what expenses are reasonable and allowable for debtors post bankruptcy. A debtor who makes more than the state medians will be forced into a 5 year repayment plan at a minimum of $100/month.

According to Priore, “How can you punish people having financial hardships yet do little to curb high-interest and aggressive lending practices. Twenty Five years ago, the credit card rates that we today take for granted would be illegal.” Mr Priore further noted that this law is essentially designed to protect creditors at the expense of consumers, thousands of which have a legitimate need for Chapter 7, including, but not limited to, single mothers, recently unemployed and those burdened with expensive illnesses.

The law, which President Bush eagerly signed, will take effect 180 days after the signing, and will have a profound effect on many of the 1,6M Americans who have filed for bankruptcy this year. Most debtors who now qualify to file under Chapter 7 will in the future be required to file under Chapter 13 and work out a plan to repay their creditors.

Before founding New Leaf Debt Settlement, Priore was a managing attorney for a third party litigation group for Charles Schwab, Inc. and counsel and chief compliance office to MVC Capital. Priore received his BA from Tufts University in 1991 and his JD from Tulane University in 1995.

People who are concerned about the bankruptcy law may read the law’s contents at www.newleafdebt.com