The Bankruptcy Abuse Prevention and Consumer Protection Actof 2005 (Pub.L. 109-8, 119 Stat. 23, enacted April 20, 2005), provided for significant changes in bankruptcy in the United States. It was passed by the 109th United States Congress on April 14, 2005 and signed into law by President George W. Bush on April 20, 2005. The Act was supported by creditors who lobbied politicians to pass the bill to make filing bankruptcy more cumbersome and expensive for consumers in an effort to reduce the number of filings. The creditors argued that consumers were abusing the bankruptcy system by intentionally running up debts and then filing bankruptcy to avoid paying their obligations. As a result the Act adopted credit counseling requirements, a median income test, a means tests, increased the waiting period between filing subsequent bankruptcies, among other changes.

Regardless of the hurdles created by the passage of the Act the number of bankruptcy filings continues to increase as a direct result of the failing economy. As more and more Americans struggle to make ends meet due to any number of reasons including but not limited to: unexpected illness, divorce, loss of employment, under employment, adjustable rate mortgage payments that have risen faster than income, and depreciation of home values the number of consumers filing bankruptcy continues to rise. The stigma that used to attach to filing bankruptcy has all but vanished. Sometimes filing bankruptcy is the only way for a consumer to save their home from foreclosure.

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