Representing North Carolina’s Ninth District                                                                        

REP. MYRICK VOTES TO REFORM BANKRUPTCY LAWS

(Washington, D.C.) – Rep. Sue Myrick (NC-9) today voted for S. 256, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.   Bankruptcy reform is needed because of system abuse.  Bankruptcies doubled in the 1980s, and then doubled again from 1990 to 2003.

 “This bill will encourage personal responsibility and will make it more difficult for people to use bankruptcy as a tool to cheat their way out of debt,” said Rep. Myrick.

 The bill increases filing fees and paperwork for bankruptcy, and mandates that potential filers attend credit counseling sessions.  This bill also Strengthens the integrity of the bankruptcy process because it creates a means test to determine which chapter of the bankruptcy code filers would be required to use.  Those able to repay a portion of their debts would be forced to file under Chapter 13, which sets up a court-ordered repayment plan.  Those unable to pay back debts would file under Chapter 7, which erases debts after they forfeit their assets. 

 S. 256 also creates a debtors “Bill of Rights” by requiring debt relief agencies to provide key disclosures and written service contracts with the debtors they assist.   The House and Senate have both passed this legislation.  President Bush is expected to sign this bill into law soon. 

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