How Elizabeth Warren’s Plan Would Change Bankruptcy Laws

If you are currently considering personal bankruptcy but have read news stories about some of the presidential candidates’ plans to amend U.S. bankruptcy laws so that they are more consumer-friendly, you may be wondering if it makes sense to wait until after the presidential election to file for Chapter 7 or Chapter 13 bankruptcy. While there is a possibility that U.S. bankruptcy laws could change depending upon who fills the role of U.S. president in the coming years and how Congress handles consumer advocate concerns about personal bankruptcy issues, any kind of changes to the law might not happen quickly enough for you to wait. In other words, if you are struggling with debt and are thinking about bankruptcy, it may be in your best interest to speak with an Oak Park bankruptcy lawyer sooner rather than later.

At the same time, it is important to understand recent news surrounding proposed changes to U.S. bankruptcy law and how they could affect consumers in the future. According to a recent report from CNBC, Elizabeth Warren recently unveiled a “plan to overhaul bankruptcy laws.” We want to tell you more about that plan.

Proposed Amendments to U.S. Consumer Bankruptcy Law: Repealing the 2005 Changes
How does Elizabeth Warren want to amend current U.S. bankruptcy law? In short, she wants to repeal the 2005 Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) and to make other consumer-friendly changes to bankruptcy law. As the report explains, Warren recently said, “I’m announcing my plan to repeal the harmful provisions in the 2005 bankruptcy bill and overhaul consumer bankruptcy rules in this country to give Americans a better chance of getting back on their feet.” Prior to being elected to the U.S. Senate, Warren was a bankruptcy law professor at Harvard Law School. In 2005, Warren opposed the BAPCPA, which had support from Joe Biden, who was at that time a U.S. senator.

In proposing to make major changes to the BAPCPA, Warren emphasized that she has worked toward other consumer protection measures since the enactment of the BAPCPA. She played a major role in the creation of the Consumer Financial Protection Bureau (CFPB) after the 2008 financial crisis, for instance.

What precisely would a repeal of the BAPCPA and other changes to U.S. bankruptcy law look like? Most significantly, Warren wants to make it “Easier for those who are in debt to obtain relief through bankruptcy, including by ending the absurd rules that make it nearly impossible to discharge student loan debt.” She also indicated a focus on addressing “racial and gender disparities in the personal bankruptcy system.” Repealing the BAPCPA would make it easier for more consumers to obtain a discharge through a Chapter 7 bankruptcy filing. The 2005 changes to U.S. bankruptcy law instituted the “means test” that prevents many Americans from being eligible for a liquidation bankruptcy. A repeal would also eradicate other barriers to both Chapter 7 and Chapter 13 bankruptcy for consumers.

Seeking Advice About Consumer Bankruptcy
While plans to change U.S. bankruptcy law to make it easier for consumers to get relief could happen in the near future, it is important for individuals and families struggling now to seek help with debt and bankruptcy. At the Emerson Law Firm, we routinely help families throughout Oak Park with consumer protection and bankruptcy matters, and we can analyze your situation today. An experienced Oak Park bankruptcy attorney can discuss your options with you for dealing with debt. Contact us for more information.


See Related Blog Posts:

Can I File for Bankruptcy if I am Self-Employed?

Can the Court Dismiss My Bankruptcy Case Without Discharging My Debt?









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