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The Bankruptcy Reform Act of 2005
Essay Instructions:
The Bankruptcy Reform Act of 2005 (formally titled “The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005”) subjects a large class of individuals to increased financial risks. The legislation has drawn criticism from consumer groups and praise from various business interests. What is your opinion on the current state of the bankruptcy code? Do you believe the 2005 legislation adequately balances, or addresses, the interests of debtors and creditors? How far should society go in allowing debtors to avoid obligations that they “voluntarily” incurred? Is it unethical to avoid paying one's debts by going into bankruptcy? Does a person have moral responsibility to pay his or her debts? What role do creditors play in this discussion? Defend your position.
sources:
Revised Chapters: Sweeping New Bankruptcy Law To Make Life Harder for Debtors; After 8 Years, Legislation Finally Nears Passage; No Limits on Card Giants; A Day Trader's Bills Come Due
Michael Schroeder and Suein Hwang. Wall Street Journal. (Eastern Edition). New York, N.Y.:Apr 6, 2005.
Bankruptcy Bill Is Set to Clear Final Hurdle With House Vote
Michael Schroeder. Wall Street Journal. (Eastern Edition). New York, N.Y.:Apr 5, 2005.
The New Rules Of Bankruptcy; Overhaul Is on Track to Clear Congress, But Housing and Trust Exemptions Remain
Michael Schroeder. Wall Street Journal. (Eastern Edition). New York, N.Y.:Mar 9, 2005.
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THE BANKRUPTCY REFORM ACT OF 2005
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The Bankruptcy Reform Act of 2005
The Bankruptcy Abuse Prevention and Consumer Act of the year 2005 was actually passed and signed in to law on 20th April the year 2005. The law was made to make significant variations to the US Bankruptcy Code. This law generally tries to make it harder for the consumers to file bankruptcy. It was argued that the last version would accomplish a lot. For long the law has been believed that filing for bankruptcy signified a final alternative for financially besieged individuals and businesses who would have chosen to circumvent the filing if at all probable. The rations of the Bankruptcy Code, nevertheless, had drifted from the ease of that logic. For instance, the rule required that creditors may power an individual or business entity into bankruptcy through an appeal for unintentional bankruptcy (Gordon, 2009).
It is therefore superficial, conversely, that federal lawmakers had come to trust that filing for bankruptcy was no more considered a disgrace to be evaded, but quite had evolved into an impressive substitute to fully repaying one`s creditors. It is very true that some analysts claimed that the Bankruptcy Code had developed to be a way for free creditors and spurt unsolicited financial responsibilities, hence there is a need for a change in the act. This law actually gave many changes in the CPAs and to Bankruptcy Code. The Act provided for some major changes in the Bankruptcy Code, and CPAs should examine it carefully when dealing with parties in bankruptcy.
The Bankruptcy Code has actually provided for 2 overall categories of entreaties through which debtors might willingly file for guard from creditors. These requisitions applied to 3 classes of debtors that include: businesses, individuals and family farmers. Those qualified to file could obtain an order to stay the collection determinations of creditors, to obtain a discharge of their indiscreet debts, or also to get a reorganizati...
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