Should it be made easier to declare bankruptcy? harder? stay the same?

Question

I vote easier. Bankruptcy can help people with a fresh clean start in life. & I don't want to hear any argument saying "people will think bankruptcy is something you declare on a regular basis"....everyone knows bankruptcy is a last resort.

Answer 1

Yes, but I believe there should be more options to consider before bankruptcy. As a "last resort" it still has some negative effects besides the clean start in life you mentioned.

More work needs to be done and professional assistance should be given to those considering bankruptcy so it can be avoided if possible and they can become solvent again (without the adverse effects of bankruptcy).

The problem with bankruptcy is it effects everybody in a flowing ripple effect. Individuals, businesses, banks and credit authorities - through higher interest rates to cover the losses. So it's in everyone's interest to reduce bankruptcy.

Answer 2

Unfortunately, not everyone knows that. It's common-- or at least, not uncommon-- among students to spendspendspend through university and then declare bankruptcy at the end of it. They live without credit into their twenties, and then get it back when they're coming up on the age where they're thinking about buying a house.

There is no reason why anyone should accumulate $20,000, $50,000, $80,000 in consumer debt and not know exactly what they're doing and that they can't afford it. No one can be "tricked" by an evil creditor into spending twice or more what they make in a year. They just keep spending and hope that something will happen in the meantime that will make paying it all back much easier (huge promotion, lottery win, etc.) That thing never comes, and so they declare bankruptcy to get out a hole they dug themselves into, at the expense of people who use their money and credit responsibly.

Answer 3

Why should people be saved from making bad decisions in life? I am not being cruel here, but this is about personal responsibility. The government did not make it harder to declare bankruptcy. What they did was made it harder to avoid paying what you owe by declaring bankruptcy. My thought is that you should be able to declare bankruptcy, but if you want to keep your possessions then you must make arrangements to pay. Bankruptcy is not as you say a "clean start". It is a means to stop creditor harassment.  

Answer 4

.   A little harder.

Answer 5

I think considering the bait and trap strategy oif credit companies, and the realities on the ground in the economy, the need for speedy and easy bankruptcy is real.

I agree that people have been careless with their credit, but they have been encouraged to do so by the practices of lenders.

This issue, like so many, has an aspect to it that the world of business would want to keep under a hat. The way banks and creditors have run their scam for the last decade is criminal. Usury and shysterism have created a problem. People need a break and the banks and creditors need serious oversight and occasionally indictment.

Sorry if that is not the answer the standard business first mentality wants to hear.

Answer 6

I believe it should be "somewhere in the middle".  Although some people do declare bankruptcy in an attempt to avoid their obligations, responsibility also lies with creditors who prey upon uneducated consumers who simply never had the means to realistically pay the debt.

Recently, creditors have successfully gotten bankruptcy laws changed to make it harder for people.  I believe the laws should somehow be written to address the fact that credit card companies regularly target high school/college graduates with offers of credit when the kids have little or no income.  If a company has the bad judgement to give, say, $5000 worth of credit to a kid making minimum wage they should be penalized by losing their money.

I think creditors should be forced to provide evidence that when they offered credit, they carefully checked to see if a person could legitimately pay the "loan".  We are now seeing foreclosures because mortgage companies offer a mortgage of $1200/monthly to a family whose monthly income is $1600.  I think courts should treat creditors very harshly by saying, "you're supposed to be the smart ones in the situation.  If you're loaning $ and preying upon people who are uneducated consumers, you'll be penalized by having the amount forgiven."

Answer 7

Yes, bankruptcy is a last resort but as long as there is an easy "last resort," people will act irresponsibly.  Making bankruptcy easy is just another form of taking assets from someone disciplined enough to earn them and redistributing them to someone who hasn't earned them.  We need to stop thinking this way.

Answer 8

Bankruptcy is an absolute last resort and it should be difficult to meet the criteria.  

You stated that it provides people with a fresh start, however in some not all cases bankruptcy results directly from irresponsible management of finances. I would have to state that if you have a certain level of consumer debt then one should not be able to declare bankruptcy.   You know what you are doing when you go out and buy $10,000 worth of electronics when you only make $20,000 per year.

I will concede that in the case where a person has lost a job, is unable to find meaningful employment and is just having a very difficult time making ends meet bankruptcy can be a huge relief.

Bankruptcy costs business and the economy a great deal of money, and fort hat reason it should be very difficult to successfully file.