The Evolution of Bankruptcy: How Time is On Your Side Skip to main content

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The Evolution of Bankruptcy: How Time is On Your Side


Are you feeling too broke to break out of debt? For those ready to end the cycle of debt, it is important to understand that bankruptcy is not a one-size-fits-all solution, and bankruptcy filings are complex cases catering to your individual economic needs.

Bankruptcy, like so many areas of the law, is in a constant state of evolution, having been refined and redefined over the decades and through several important pieces of legislation. The first major bankruptcy legislation since the Chandler Act of 1938— Bankruptcy Reform Act of 1978—brought some of the most significant changes to the U.S. Bankruptcy Code. Within this Act, there were a host of important changes that the Act brought to the U.S. Bankruptcy Code—changes that can help you in these tough financial times:

(1) The Bankruptcy Reform Act of 1978 introduced Chapter 13 bankruptcy protection. Referred to as a wage-earner reorganization bankruptcy, this new type of bankruptcy can now stop foreclosure on your home or restructure your consumer debt into a more manageable payment plan— allowing debtors to pay back what they owe over time, often at a percentage of the cost.

(2) For the first time, this act also allowed married couples to file a joint bankruptcy. Because husband and wife file a single bankruptcy case pursuant to these rules, only one filing fee is paid to the Clerk. These days, considering the fact that the filing fee for Chapter 7 and Chapter 13 bankruptcy can be hundreds of dollars, and attorney fees ranging even higher, this results in major savings. Married couples should consider filing jointly filing when most debts are jointly held between as is often the case of credit card debts, mortgage loans and automobile loans.

(3) The legislation also introduced additional exemptions for filers, allowing individuals, for the first time, to keep most, if not all, of their property. Assets you can keep in bankruptcy can include certain retirement plans, education funds, and even real property under homestead exemptions.

(4) The act reorganized various chapters of the Bankruptcy Code. Specifically, Chapters 5, 6, & 7 were changed to Chapter 11 bankruptcy. For the first time, businesses filing for bankruptcy after the act began using Chapter 11 bankruptcy. Today, Chapter 11 bankruptcy is a form of bankruptcy reorganization available to individuals, corporations and partnerships. It has no limits on the amount of debt and is the usual choice for large businesses seeking to restructure their debts.

With the legislation Bankruptcy Reform Act of 1978 bankruptcy reforms were highly substantive and substantial, shaping the law to the needs of a public eager to get a fresh financial start. These specific efforts and exemptions are the primary reason that it is important to have a good bankruptcy attorney on your side; someone who is familiar with the process and knows precisely how the latest laws can assist you.

Well, it’s finally time to halt the hesitation, dismiss the deterrents, and suffer no more; because, in fact, the opposite can be true in the world of bankruptcy law. Days, weeks, and months wasted without speaking to a qualified bankruptcy expert can actually add up to higher bills, increased interest and greater stress—creating a costly cycle of creditor-debtor “cat-and-mouse”—that you continue to pay for—with the constant risk of losing even more.

Specifically, the bankruptcy attorneys at the Law Offices of John T. Orcutt offer a totally FREE debt consultation and now, more than ever, it’s time to take them up on their offer. Just call toll free to +1-919-646-2654, or during the off hours, you can make your own appointment right online at Simply click on the yellow “FREE Consultation Now” button.

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