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Bankruptcy Laws And How They Change

By: Letha Lashley

Heading toward bankruptcy is usually something that most people don't even consider having happen in their lifetime. But statistics today prove differently. The reality of bankruptcy today is that there are increasing numbers of people that are entering the bankruptcy system. The different chapters of bankruptcy (chapter 7, chapter 11, chapter 13) are becoming more and more prevalent today.

Congress was the body of lawmakers that decided that the U.S. bankruptcy laws were in need of uniformity and as such they implemented Federal bankruptcy laws that the states are obligated to conform to. Although each state can have its own set of bankruptcy laws there are some basic statutes mandated by the U.S. government that all must follow. These bankruptcy codes have been put in place to help people relieve themselves from financial burden and to cease engaging in financial self destruction.

At the time of this writing there are currently four different chapters to the bankruptcy code. For example, you may be familiar with the bankruptcy term Chapter 7 bankruptcy. The chapter 7 part is the section of code or the statutes that address the rules and regulations of Chapter 7 bankruptcy.

Each of the various bankruptcy chapters have their own unique set of rules, regulations, and statutes as they pertain to the filing procedures, how the debt is ultimately relieved, and how the creditors are affected and what their rights are in the procedure or chapter.

Although the bankruptcy codes were provided for by the U.S. federal government, each state has the right to pass other laws that will work within the framework of the federal statutes on bankruptcy; otherwise the states don't have autonomous power to govern how the overall bankruptcy code functions.

Keep in mind however, that even thought the states can't change or amend the basic intent of the core bankruptcy laws, they do have the latitude to interpret how the filings take place and how the laws should be applied.

As is the case with statutes, they tend to be somewhat dynamic; meaning they change with additions and deletions to the code over time as amendments are ratified through the body of lawmakers. Because of this dynamic, it is a very good idea for an individual considering bankruptcy as an option to seek the counsel of an attorney who deals in the area of bankruptcy code.

Any type of change to the top level of the bankruptcy codes and statutes will have to come from the United States Congress. On such change has come down the pike as it pertains to the filing of a Chapter 7 bankruptcy. The change to the core statute to this chapter had to do with the burden of proof. Essentially, it added additional criteria (or burden of proof)upon the person filing in order for them to meet the criteria necessary to have the right to file for bankruptcy.

Because of the influx of people entering the bankruptcy system, this type of change to the core bankruptcy statutes was put in place. Now, across all states, if someone is seeking bankruptcy protection under the law; they are required to complete a court appointed financial and bankruptcy counseling session. This was done to help protect the system and creditors from those who just wanted not to pay off their debts.

Article Source: http://www.topicinfo.com

For more information on banruptcy codes, be sure to visit onwebnet.com where you'll find information on topics such as bankruptcy laws, chapter 7 bankruptcy, bankruptcy filing & more

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