About 85 percent of individuals who file under Chapter 7 earn income below their state median, so most people who seek bankruptcy protection will have no trouble meeting the new standard, says Sam Gerdano, executive director of the American Bankruptcy Institute. But the law could disqualify people who suffered a major financial setback, such as serious illness or unemployment, bankruptcy attorneys say.

For example, someone who recently lost his job and has no near-term employment pro-spects could be barred from filing under Chapter 7 because his income during the past six months exceeded the state's median income, says Nora Raum, a bankruptcy attorney in Arlington, Va.

Concerns about these types of cases led some lawmakers to seek a reprieve for victims of Hurricane Katrina, which left thousands of people homeless and out of work. But supporters of the law say it gives bankruptcy judges authority to waive the restrictions for victims of "special circumstances," such as a natural disaster.

The change is particularly significant for borrowers with a lot of student loans.

Under current law, it's extremely difficult to wipe out student loans from the government or a nonprofit organization, even under Chapter 7 bankruptcy. The new law expands that provision to include student loans from private lenders, says Henry Sommer, editor-in-chief of Collier on Bankruptcy.

But even with the deadline looming, think hard about whether bankruptcy is the solution to your financial problems.

A Chapter 7 bankruptcy filing will remain on your credit report for 10 years. While you'll probably be able to get credit, you'll pay a much higher interest rate. And if you're in debt because you can't control your spending, filing for bankruptcy won't solve your problem, says Richard Chaifetz, chief executive of ComPsych, an employee-assistance firm.

You could find yourself back in bankruptcy in a few years, he says, and the new law will make it much more difficult to get out from under your bills.