Complete Relief

“Insanity in individuals is something rare - but in groups, parties, nations and epochs, it is the rule.”

--Friedrich Nietzsche--

“It is dangerous to be right when the government is wrong.”

--Voltaire--

“The marvel of all history is the patience with which men and women submit to burdens unnecessarily laid upon them by their governments.”

--William H. Borah--

We have heard a lot of talk from both candidates for the Democratic Nomination for the Office of the President of the United States of America about the need for government action to address the mortgage crisis that is sweeping across this country. However, I have yet to hear about a part of the solution that must be included in order to give relief to millions of home owners. That is an immediate repeal or amendment of the Bankruptcy Act of 2005.

Both candidates for the Democratic Nomination have talked about the need for a bail out for home owners that have sub-prime loans where their payments have exploded to levels where they can not afford to make them and pay the rest of their bills. I do believe that something must be done to specifically address the issues that were created by an industry that wanted to prey upon a simple need to own a house. However, there are plenty of home owners as well as renters that are being pushed to the wall of homelessness or forced to retreat back home with their parents or other family members because they can not afford to pay all of their bills and they have no workable recourse under the law. They have no recourse under the law because the current Bankruptcy Law favors creditors and makes it difficult to discharge debt especially if you are a home owner.

Due to the current law people are locked into a debt structure and have no opportunity for relief so they could be forced to choose between paying their mortgage payments or their grocery bill. People are losing their homes because they can not afford to make their mortgage payments and the rest of their daily bills. One good way to give people permanent relief is to give them a chance to get out from under their debts if it becomes too much for them to bear. That is why the current Bankruptcy Law must be changed.

Under the current Bankruptcy Law many hard working people that can no longer pay all of their bills are forced into a Chapter 13 repayment system that may still saddle them with a repayment plan that they still can not make. This should be changed immediately!!!

A few changes to the current Law could mean relief for millions of people that are being forced out of their homes because they can no longer make all the payments on their daily debt. 1) The Law should be changed to provide a federal homestead exemption of at least $25,000 or the state exemption, whichever is higher. The homestead exemptions could also be increased at the state level by the state legislatures. 2) The Law should be changed to shift the burden of proving fraud from the filer to the creditors by eliminating the means test. 3) The Law should be changed to remove the prohibition of people with “high incomes” from being able to file bankruptcy under Chapter 7 when they have high non-dischargeable debts such as student loans and/or child support. 4) The Law should be changed back to valuing property by what it could be sold for at an emergency sale. 5) The Law should be changed to remove the requirement that people that file bankruptcy under Chapter 13 have to give a portion of their income to the IRS, instead of just submitting a repayment plan to the trustee.

The American people should require all of the Presidential Candidates to address the Bankruptcy issue along with the mortgage crisis. We should also make every senator and representative that voted for the current Bankruptcy Law to explain their vote. They should also be required to explain why they voted for a law that was labeled as The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, but instead was the Credit Card Industry Protection Act of 2005.

The Banking and Credit Card Industries gave more than $100 million dollars in political donations to lawmakers between 1999 and 2005. The credit card and banking industries said they needed the changes because they were saddled with annual losses of $3-4 billion due to well-off consumers taking advantage of loopholes in the old law to rack up and walk away from unpaid loans. Yet, they still retained enough profits to be able to make such huge political donations over a six year period. The reality is that the lawmakers that voted for the current Bankruptcy Law chose moneyed interests over the best interests of the American people and now we as a country are suffering the consequences. Maybe it is time that we as a country turned the tables and forced our lawmakers to correct their mistake.