Bankruptcy Debt - Changes in Credit Card Laws May Lead to Reduction in Bankruptcy Filings

As the new credit card regulations have come into effect

, we hope to be in a new era to manage our debts and credits. Now the credit card users can expect drastic changes in Credit terms, interest rates and monthly fees as the new provision designed come into effect. An unprecedented reduction in the bankruptcy cases has been expected in the recent times after the new Credit card regulations have come into effect which has been specially designed so as to lower the bankruptcy cases which increased rapidly during the economic slowdown.

The new federal law has ushered in stricter requirements for the debtors to file for bankruptcy. Amongst the new provisions are - a test to determine the financial eligibility of the debtor to file, an eight year moratorium if caught filing for the bankruptcy a second time, there is a mandatory debt management and counseling sessions for credit. The propositions of this law and its components have been formulated to raise the bar for the filers so as to weed out criminals who have been exploiting this provision by deliberately expanding the debt and then very easily walking away of the situation and obligations through this process. With the help of this an actual decrease in the bankruptcy has been seen in the recent times. Even other rules such as limit on interest rate hike, limited universal default, limited credit to young adults(prohibition from giving cards to people under 21), sufficient time to pay the monthly bills and dues, clearer due dates and time, limitation on over- limit fees and stricter bankruptcy rules have all contributed to the Reduction In Bankruptcy Filings.

Despite of all theses rules and regulations and being touted as a win-win situation for consumers, financial experts are of the view that the bill could have unintended consequences as the credit card companies will definitely be on a lookout for meaner ways to compensate for potential lost revenue.

Bankruptcy Debt - Changes in Credit Card Laws May Lead to Reduction in Bankruptcy Filings

By: pollstump

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