Good Or Bad? Jury’s Still Out
It’s been a year now, or almost, and well I guess it is a good time to take stock and see how things have worked. The debt situation in the country is pretty bad and yes, something drastic was required to stem the tide of bankruptcies. But was the new law the solution? Well, even now, a year after it was introduced, the jury is still out.
Last year, I still remember reading and writing about the long queues of people who were beating down lawyers’ offices in a desperate bid to beat the deadline. They were rushing to get their bankruptcy cases filed before the new law would make it tougher. In the months since, consumer debt soared to a record $2.3 trillion, loan delinquency rates rose, and foreclosure lawsuits jumped dramatically. And interestingly, bankruptcy filings fell off a cliff and have not yet come back. Theledger.com reports:
As bankruptcy reform heads toward its first anniversary next week, supporters and critics still argue whether it’s a boon or a bomb. For bankruptcy filers themselves, the impact of the changes has been considerably less dramatic than many hoped or feared. "For people who file, the results are not terribly different than they were before, except it’s more bureaucratic and cumbersome," said Henry Sommer, editor of LexisNexis Collier on Bankruptcy and president of the National Association of Consumer Bankruptcy Attorneys.
Read more: Experts Split on Merits of Bankruptcy Reform