interest a written objection to the taking of the proposed action. Legislative IntentThis law is intended to allow individuals to pay off their debts in three to five years and start over with a "clean slate", that is, they will be debt-free. However, there is concern about abuse of the bankruptcy law. Individuals may run up high debts, then go bankrupt and not have to pay their debts. When they run up their debts with the intent to go bankrupt, it is fraud. However, it is difficult to prove that they intended to go bankrupt when they ran up their debts. The number of bankruptcy filings reached an all-time record of 1,366,887--one filing for every seventy-six American households--during the year ending 30 September 1997, even though it was a period of strong economic growth. The bankruptcy rate is now six and one-half times the average annual rate of the 1970s. In fact, there were more filings during the second half of 1997 than during the entire decade of the Great Depression. The Bankruptcy Reform Act of 1994 tried to ease the situation by having Congress establish a bipartisan National Bankruptcy Review Commission to redraft the US bankruptcy laws. Many of the Commission's recommendations, which were submitted to Congress in October 1997, actually would not do much to make situation better: "The proposed legislation would increase debtors' entitlements and property they retain upon declaring bankruptcy. Rather than reform, these changes are welfare under another name, with creditors seemingly forced to foot the bill. Overall, these changes may actually increase the bankruptcy rate" (Pomykala, 1997).Under Chapter 7 bankruptcy rules, the debtor's assets are liquidated (sold for cash) and the proceeds are distributed to the creditors. However, Chapter 13 allows consumer debtors to retain possession of their property as an alternative to liquidation. They are required to submit a debt repayment plan that gives their credi...
