Bankruptcy has not always been viewed so favorably. Consider the Romans' severity in 450 B.C. Under the law of the Twelve Tables, Table III, Execution of Judgment, creditors were permitted to cut the debtor's body into sections, with each creditor receiving a portion equal to the debt owed. Even the Latin language had a term for the act: de debitore in partes secando, or """"the debtor sequestered into parts."""" Not exactly a favorable result for the debtor.
In England, bankruptcy laws were enacted to the detriment of defaulters. In the sixteenth century, England enacted laws that allowed creditors to recover their funds. When the creditor wished to file bankruptcy charges, the borrower was compelled to pay. As time progressed, the laws became even more stringent, allowing creditors to claim a greater proportion of the bankrupt's assets. One amendment stated that the creditor may cut off the debtor's ear as punishment. For not paying his fines, the debtor could also be taken to court and sentenced to execution. These laws only applied to merchants; the average Joe with a large amount of debt was promptly thrown into prison, where he had a greater chance of contracting diseases and dying.
Nowadays, filing for bankruptcy will not cost you an arm and a limb. The United States has adopted a distinct, more lenient bankruptcy policy than its predecessors. There are no longer debtors' institutions. Consumers and businesses can petition for bankruptcy, and there are numerous options for paying off debts. In Chapter 7 bankruptcy, the debtor may liquidate his or her assets in order to repay debts. The debts may then be discharged or forgiven. Chapter 13 bankruptcy allows an individual to modify their debts over a period of time, typically three to five years. The defaulter may retain his property while repaying his debt. Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act in 2005, predominantly as a result of credit card and other creditors' lobbying efforts. While this made the process of filing for bankruptcy more difficult and pushed more individuals into Chapter 13, it has had no effect on the total number of filings. Currently, a record number of consumers and businesses are utilizing the bankruptcy laws to start over or consolidate their obligations.
No one wishes to declare bankruptcy, but sometimes there is no other alternative. With the proper attorney, the process of filing for bankruptcy can be very smooth. You should not be afraid to apply for bankruptcy if it is manifestly your best option.""
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