It is reasonable to ask, 10 years since the implementation of the Bankruptcy Abuse Reform and Consumer Protection Act, whether the reform law achieved its goals, according to an American Banker commentary today by John McMickle, a former counsel to the Senate Judiciary Committee who helped to draft the legislation. McMickle believes that the law has worked well, though not perfectly. As intended, the number of bankruptcy filings has declined dramatically since 2005, from almost 1.7 million to 920,000 in 2104, according to McMickle. He thinks that the "means test" — which measures a prospective bankruptcy filer's ability to pay and channels those with higher incomes into repayment plans — has worked well. “Despite criticism, the ‘means test’ assures repayment but permits the truly distressed to avoid hardship,” McMickle writes. Read the commentary.
For additional expert perspectives of business and consumer bankruptcy trends on the 10th anniversary of BAPCPA, be sure to watch ABI’s media webinars, “BAPCPA at 10.”
