H.R. 333 overhauls the U.S. Bankruptcy Code to require debtors with the ability to repay some or all of their debt to do so. Under current law, there is no statutory mandate requiring a debtor to repay debts even if one has the financial means to do so. Congress passed the measure in each of the last two terms only to have it vetoed by President Clinton. The bill has enjoyed broad, bipartisan support in the past and continues to do so. This reform protects the rights of those who truly need and deserve a fresh start as determined by legal standard.
Bankruptcies cost American taxpayers billions of dollars each year.
At present, individuals with significant income and the ability to repay some of their debts can obtain the same full discharge of debts as individuals with little or no income and assets. It allows a debtor to discharge debts even if he can repay large portions of what they owe. This is a major consumer issue. Responsible borrowers and consumers of all good and services pay the price of bankruptcies of mere convenience. However, this legislation will ensure that those who blatantly misuse the system to wipe out debts they can afford to pay, will not be allowed to do so.