The last few months have taught us one thing: The coronavirus isn’t going away anytime soon and it has impacted nearly every aspect of life – including bankruptcy filing.
Because of the coronavirus (COVID-19) pandemic, changes to the court system and how we practice law have been made and there have also been modifications to the bankruptcy rules that govern bankruptcy filing. Namely, the CARES Act has brought in temporary changes.
So, what is the Coronavirus Aid, Relief, and Economic Security (CARES) Act? It’s a bill that provides relief for those who have been impacted by the coronavirus.
For individuals, the CARES Act – enacted on March 27, 2020 – has several provisions for Chapter 7 and Chapter 13 bankruptcy filing. Of course, these changes are temporary and expire March 27, 2021.
Another thing the act does is to exclude from calculating monthly income any COVID-19-related payments from the Federal government. make the one-time payments – given as an economic stimulus – to be excluded from calculating monthly income. This is important, as it can determine your eligibility to file bankruptcy under Chapter 7 or 13.
The CARES Act also will potentially allows individuals to extend their Ch. 13 plan from five to seven years if they can prove there is financial hardship due to the coronavirus.
The courts are also waiving the procedural requirements of original signatures on filings, in person hearings in certain non-evidentiary matters, allowing Zoom meetings for telephonic hearings as well as or electronic signatures, as well as phone hearings in lieu of in-person appearances.
Lawyers can also verify their client’s identity, providing copies of driver’s licenses and Social Security information, as well as submit filings manually via a drop box.
These measures are likely to continue as long as the stay home orders are in effect and the threat of the coronavirus is looming., as the courts are not expected to reopen any time soon.
In a nutshell, bankruptcy filing is still happening and available, should you need it. There are changes but it is still the same basic system. The coronavirus hasn’t changed the need to file; it’s just changed HOW you file.
If you have questions or concerns about bankruptcy filing, the legal experts at Mina Nami Khorrami LLC can help. Contact us today at 614-857-9590.