What is the Bankruptcy Reform Act?

The Bankruptcy Reform Act is a federal law passed by Congress in 1978 that changes the way bankruptcy is handled in the United States. It was created to help people who are struggling with financial difficulties get back on their feet. The act provides debtors with certain new rights, including protections from creditors and a new way to pay off their debts. In Tennessee, the Bankruptcy Reform Act allows individuals or businesses to file for Chapter 7 bankruptcy, which eliminates most of their debts. It also allows the filing of Chapter 13 bankruptcy, which restructures the debt so that it can be paid off over a period of three to five years. In both cases, debtors have to provide the court with detailed financial information about their income, assets, debts, and expenses. The Bankruptcy Reform Act also makes it easier for creditors to collect on debts owed to them. Creditors may seize a debtor’s property and garnish wages to get their money back. As long as the bankruptcy is properly filed, the debtor is responsible for all debts that have been discharged or restructured and will be required to make payments on those debts. The Bankruptcy Reform Act of 1978 is an important piece of financial legislation in Tennessee and throughout the United States. It allows individuals and businesses to manage their debt with a structured system that keeps the creditors and debtors both safe and responsible.

Related FAQs

What is the Check Clearing for the 21st Century Act?
What is the difference between a secured loan and an unsecured loan?
What is the Home Mortgage Disclosure Act?
What is the Community Reinvestment Act?
What is the Community Reinvestment Modernization Act?
What is the federal Bank Holding Company Act?
What is the Bank Secrecy Act?
How is banking law regulated?
What is a loan originator?
What is the Electronic Signatures in Global and National Commerce Act?

What is the Bankruptcy Reform Act?

Related FAQs

Related Blog Posts