Bankruptcy law is contained in Title 11 of the United States Code. It was created to establish a medium through which debtors can resolve their outstanding debts with creditors. Bankruptcy is not designed to penalize debtors, but rather help them. As a result, the bankruptcy law attorney must help his clients to the greatest extent of his ability.
Consumer debt in the United States is at an all-time high. More and more Americans are finding themselves in compromising financial positions. It is during these moments that bankruptcy becomes an attractive option. Consumer debt is measured by comparing the average American household indebtedness to the average amount of disposable income. With less disposable income, Americans are finding that paying credit card bills on time is increasingly difficult. Consequently, the number of bankruptcies filed in recent years has gone up, despite recent laws passed in 2005 that made filing for bankruptcy much more difficult.
For individuals, the two most common kinds of bankruptcy filings are Chapters 7 and 13. With Chapter 7 bankruptcy, obligation of payment is removed from the debtor's shoulders. Chapter 13 bankruptcy, also known as the wage earner's plan, allows the debtor to repay debts over a period of time in a manner that is approved by a bankruptcy court.