Heading toward bankruptcy is usually something that most people don't even consider having happen in their lifetime. But statistics today prove differently. The reality of bankruptcy today is that there are increasing numbers of people that are entering the bankruptcy system. The different chapters of bankruptcy (chapter 7, chapter 11, chapter 13) are becoming more and more prevalent today.



The United States Congress originally put the U.S. bankruptcy laws into place in order to provide a more consistent approach for people considering bankruptcy no matter which state that they may have lived. The philosophy behind the bankruptcy laws is to offer people who are struggling with no hope a vehicle to stop continuing to due financial harm to themselves.

Currently there are four different sections or chapters to the bankruptcy statutes. For instance, you'll probably recognize such bankruptcy terminology as chapter 11... which is the section of bankruptcy code that can be found in chapter 11 of the statute.

With these various chapters of bankruptcy, are explanations of how the various laws are set up to deal with the filing procedures and how the debt is relieved or negotiated down. There are also provisions regulating the behavior of the creditors themselves as it pertains to contacting and collection attempts by the creditor.

Even though there are Federal bankruptcy statutes that each state must follow, each state can still pass its own laws concerning the execution of the bankruptcy proceedings. This as long as these local state laws still fit within the framework of the Federal. In other words, states have the power to establish law concerning bankruptcy but not complete autonomy in doing so.

So, even though the individual states cannot change the intent of the Federal bankruptcy laws, each state can however, interpret how the claims must be filed and how the claims are acted upon.

As is the case with statutes, they tend to be somewhat dynamic; meaning they change with additions and deletions to the code over time as amendments are ratified through the body of lawmakers. Because of this dynamic, it is a very good idea for an individual considering bankruptcy as an option to seek the counsel of an attorney who deals in the area of bankruptcy code.

Any type of change to the top level of the bankruptcy codes and statutes will have to come from the United States Congress. On such change has come down the pike as it pertains to the filing of a Chapter 7 bankruptcy. The change to the core statute to this chapter had to do with the burden of proof. Essentially, it added additional criteria (or burden of proof)upon the person filing in order for them to meet the criteria necessary to have the right to file for bankruptcy.

With this change, the person seeking relief from the bankruptcy courts will only be approved for filing once they have completed a court approved financial and bankruptcy session. With the ever growing number of people seeking relief from debt via the bankruptcy system, this amendment was added to help ensure that the person filing was truly in a financial dead end and not someone who had just incurred a great deal of debt with no intention of paying it off.