Bill would limit Chapter 7 filing

Northwestern Financial Review, Oct 4, 1997

Reps. Bill McCollum (R-Fla.) and Rick Boucher (D-Va.) have introduced a bill which would make it harder for high income individuals to eliminate their debts by filing for Chapter 7 bankruptcy. The bill would not allow consumers who could afford to repay at least 20 percent of their unsecured debts to file for Chapter 7 bankruptcy.

They would have to file for Chapter 13 bankruptcy, where they would have to repay at least a portion of the debt. Current law stipulates that people cannot claim credit card debt incurred within 60 days of filing for bankruptcy; the proposed legislation increases that to 90 days.