CONGRESS Bankruptcy bill passes Senate vote

Sweeping changes would require Chapter 13 filers to repay some of their debts.
WASHINGTON POST
WASHINGTON -- The Senate approved late on Thursday a measure backed by the credit-card industry that would make it harder for individuals to wipe out debt through bankruptcy, setting a path for passage of the bill by the House as early as next week.
The 74-25 vote in favor of the bill, which makes the most sweeping changes in bankruptcy law in more than 25 years, was propelled by a 55-member Republican majority who voted in unison, joined by 18 Democrats and one independent.
House Republican leaders have promised to take up the bill within weeks -- and to deliver the votes to pass it. That commitment was based on the Senate keeping the bill free of major new amendments that would have undone scores of compromises carefully crafted over several years in an effort to secure passage of the measure.
President Bush said he would sign the bill. It would be the second major win for big business in Bush's second term, following passage last month of legislation intended to curb class-action lawsuits against corporations.
Chapter 13 changes
The Senate-passed bill would require many consumers filing for bankruptcy court protection to repay a portion of their debt under Chapter 13 of the bankruptcy code rather than allowing them to erase it almost entirely. It is estimated that the proposed legislation would force an estimated 30,000 to 100,000 additional filers a year into Chapter 13.
Consumer groups and many Democrats say the bill is too harsh on individuals who fall on hard times from sickness, divorce or job loss and have criticized it for retaining a loophole that allows wealthy individuals who file for bankruptcy to protect expensive homes.
Supporters
The bank, credit-card and retail industries, which have pushed for the legislation for more than seven years, argue that changes to current law are needed to end abuse of the system by consumers who shirk their financial obligations when they could repay a portion of what they owe.