What is the Bankruptcy Abuse Prevention and Consumer Protection Act?

The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) is a law passed in 2005 that makes it harder for individuals to seek bankruptcy protection. BAPCPA affects consumers from all states, including Georgia. The main purpose of the act was to prevent abuse of the bankruptcy laws by individuals who have the ability to repay their debts but seek to use bankruptcy to escape payment. The act requires debtors to pass a means test in order to qualify for Chapter 7 bankruptcy, which eliminates most debts. The act also seeks to ensure that debtors who qualify for Chapter 13 bankruptcy are able to repay their creditors. BAPCPA also requires individuals to attend credit counseling and financial management classes before filing for bankruptcy. The act also makes it more difficult for debtors to discharge certain types of debts, such as student loans and domestic support obligations. Finally, the act imposes substantial penalties for debtors who are found to have engaged in dishonest or malicious activity when filing for bankruptcy. Overall, the Bankruptcy Abuse Prevention and Consumer Protection Act is an important law designed to discourage people from seeking bankruptcy protection when they are otherwise capable of paying their debts. In Georgia, as well as in all other states, the law requires individuals to meet certain criteria in order to file for bankruptcy, and imposes penalties for those who abuse the system.

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What is the Bankruptcy Abuse Prevention and Consumer Protection Act?

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