People with higher incomes won't be allowed to use Chapter 7. Also, no one can file at all, until after they prove they have had credit counseling first.

Your income has to be equal or less than the "median" income in the state for a family your size. You also have to calculate whether you have some money left over, after paying all the normal necessary living expenses, to pay off some of your debts. If so, you can't file Ch.7; you have to file Chapter 13.

Because the new law makes it more complicated in a legal, law practicing, sort of way as well, you will have to pay more in legal fees, and restrict your choice of attorneys to only those who are more expert in these new complications.

Another change the new law brought about is in the methods and process for valuation of property. This has had the effect of making bankruptcy less advantageous for the vast majority of people choosing it.

The Bankruptcy Abuse Prevention and Consumer Protection Act was introduced in 2005 to prevent what was regarded by the financial services industry as widespread abuse. The 2005 code prevents people from filing chapter 7 when they're in a position to offer some form of payment to creditors.

Eligibility is now determined by a means test. You'll qualify under the new bankruptcy law if your household income for the last six months is below the average for your state. However, you'll be expected to hand over any non-exempt assets, such as a second home or luxury car, to a court-appointed trustee. These assets will be sold and the proceeds disseminated to creditors. You cannot file for chapter 7 twice in any eight year period.

The latest figures tend to suggest that those who need to file are still able to do so. Figures produced by the U.S. courts revealed that 1,100,116 people filed chapter 7 in the 12-months end December 2010.