Many new laws have been passed to assist home and business owners during the COVID-19 virus pandemic.
The Small Business Reorganization Act and the Cares Act were passed to allow persons in business to move efficiently through a bankruptcy organization.
- Small Business Reorganization Act
Highlights of this law include:
- Debt limits are increased from $2,725,000 of debt to $7,500,000 (secured and unsecured). The increase ends on March 27, 2021.
- Business owners retain full ownership even if unsecured creditors are not paid in full.
- A faster process to approval by eliminating disclosure requirements.
- Expenses are reduced.
- Creditor voting on your plan is eliminated.
- No Trustee fees.
- No creditors can file a plan.
- A court appoints the trustee to assist in obtaining a consensual plan.
- Cares Act and Consumers
Highlights of this law include:
- An extension of chapter 13 plans to seven years if a direct or indirect hardship exists. This includes unemployment due to the pandemic.
- Stimulus payments are not included in your income calculations.
- A possible decrease in some existing payments to creditors.
- Federally insured mortgages must defer regular mortgage payments for six months or more upon request. This includes deferral or forbearance options.
- DOE back student loans payments are suspended to September 30, 2020.
- Current mortgage foreclosure forbearance.
Please contact Attorney James M. Nugent to discuss your options. Don't risk losing your home, business or other valuable assets.