The Implementation of New Bankruptcy Laws

Paper Summary:

This paper discusses how new federal bankruptcy laws are making it more difficult for consumers to file. It points out that these laws have affected not only US consumers, but the economy, government, and the legal field as well. The paper examines the new changes implemented in order to determine the effects the new laws have had and exactly why so many people are filing for bankruptcy protection. Although many consumers and civil right groups disagree with the decision, many law makers agreed that something had to be done to prevent the abuse of bankruptcy protection. The paper maintains that the new bankruptcy laws were designed to help prevent the abuse of bankruptcy and allow citizens who really need to file an opportunity to start fresh. It concludes that, by understanding the new laws implemented into the bankruptcy system, one can gain a greater appreciation for whom the laws are designed for and hopefully prevent their abuse.

From the Paper:

"Now, however, the new laws are much harder on both Chapter 7 and Chapter 13 filers. Some changes made to the federal bankruptcy laws just make sense. The first change implemented was that "people would be required to receive some type of credit counseling within 180 days of them filing a petition for bankruptcy". While working at a law firm I was able to attend bankruptcy court and hear of people who were filing for the third and fourth time. I was astounded at how the judge just "wiped all the debt away". I think I could have been more sympathetic if it was their first time, but by the fourth time you have filed bankruptcy, it should be a clear indication that something is wrong. This new legislation allows people to get help and learn how to manage their finances. I feel that in our education system we do not focus on such things as budgeting and finances for our high school youth who are so naive about credit and the dangers of credit cards once they graduate. When I turned 18, I had credit offers piling up in my campus box. Although my parents had warned be about using the credit cards, the offers were too good to resists. The "easy payments of only $12 dollars a month" were so appealing I too became a "credit card binger". I feel that implementing some sort curriculum our school systems would better educate and prepare students graduating to endure the credit card hagglers and all the wonderful offers they shove in our campus boxes."

Sample of Sources Used:

• Augusta Chronicle Editorial Staff . "The Party's Over". Augusta Chronicle on the web. 21 May 2005. 15 April 2005 . <http://chronicle.augusta.com/stories/041605/edi_3905550.shtml>.
• Associated Press. "New Bankruptcy bill forces clients' hands". BillingsGazette on the web. 21 May 2005. 19 March 2005. <http://www.billingsgazette.com/index.php?id=1&display=rednews/2005/03/19/build/business/30-bankruptcy-bill.inc>.
• Bush, President George W. "President Signs Bankruptcy Abuse Prevention, Consumer Protection Act". President's Remarks. Whitehouse.gov news release. 21 May 2005. 20 April 2005. <http://www.whitehouse.gov/news/releases/2005/04/20050420-5.html>.
• Hunter, Ned B. "Understanding the new bankruptcy laws A chat with bankruptcy attorney Timothy Latimer" Editorial. Jackson Sun on the web. 21 May 2005. March 2005 <http://www.jacksonsun.com/news/bankruptcy_laws.shtml>.
• Kristoff, Kathy. "IRS puts new focus on its old archenemy: The income tax cheat" Detroit News on the web. 21 May 2005. 13 November 2003. <http://www.detnews.com/2003/business/0311/13/b01-323974.htm>.

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