The Consumer's Last Dime - (BARF) Bankruptcy Reform
BARF is a competition between creditors trying to get a leg up on other creditors, and to get the last dime out of the consumer. Just look at the tension between the IRS/child support as priority creditors, car dealers getting the full benefit of the bargain, and the feeble attempt by the other unsecured creditors to get more money by tinkering with the homestead exemptions, 10 year lookback period, etc.
Let's face it, we only have BK because creditors fight among themselves to be first in line. As has been said BK, is an ORDERLY method to get debtors to pay as much as they can---while BARF may have started out by general unsecureds to get more money it wound up as a big fight between pesky creditors to be first in line, i.e., the pecking order was readjusted. Car dealers just got in front of general unsecureds with the 910 day rule. The IRS just got in front of general unsecureds by doing away with the super discharge. DMPs got in front of general unsecured creditors by making those pre-petition payments non-avoidable as a preference. Child support got in front of everyone.
The general unsecureds would then have gotten less than they were getting, so BARF had to generate more revenue, since the above greedy creditors just cut themselves a bigger piece of the existing pie, and they all needed to work together to get BARF passed. Thus we have the emphasis on exemptions/documentation, one tv, one vcr, one computer, the 10 year "lookback" period, the 1215 day homestead rule, the 730 day homestead rule, the IRS guidelines, etc. While these are the most onerous provisions of BARF, they are really just bones tossed to the general unsecureds who toted the freight to pass BARF.
The amount of money general unsecureds will get under BARF may actually wind up being less than they got before BARF. I mean just how much money is a used tv going to generate, and any lost homestead will probably get eaten up by taxes, car payments, etc.
These folks need to call a spade a spade. BARF is the best the creditors could do playing leap frog.
Written by Kathy Cruz - Hot Springs Arkansas
