[Weekly Compilation of Presidential Documents Volume 41, Number 16 (Monday, April 25, 2005)]
[Pages 641-642]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Remarks on Signing the Bankruptcy Abuse Prevention and Consumer 
Protection Act of 2005

April 20, 2005

    Thank you all. Please be seated. Welcome. Thank you very much for 
coming today. Today we take an important action to strengthen--to 
continue strengthening our Nation's economy. The bipartisan bill I'm 
about to sign makes commonsense reforms to our bankruptcy laws. By 
restoring integrity to the bankruptcy process, this law will make our 
financial system stronger and better. By

[[Page 642]]

making the system fairer for creditors and debtors, we will ensure that 
more Americans can get access to affordable credit.
    I'm pleased to be joined today by the Attorney General Al Gonzales. 
I want to thank the bill sponsors in the House and the Senate. Senator 
Chuck Grassley of the Senate--I think you told me you'd been working on 
this bill for 9 years. That's a long time. [Laughter] I appreciate 
Congressman Jim Sensenbrenner from the House for being the sponsor in 
the House. Thank you.
    I want to thank the Speaker. Yesterday, the Speaker and I, by the 
way, had the honor of opening the Lincoln Library in Springfield, 
Illinois. I know he'd be pleased to hear me say, ``If you're looking for 
something to do this summer''--[laughter].
    I thank Senator Mitch McConnell, Senator Orrin Hatch, Senator Jeff 
Sessions, and Senator Tom Carper. I appreciate the Members of the House 
who are here, Mike Oxley, Rick Boucher, Bob Goodlatte, Steve Chabot. 
Thank you all for coming, and thanks for working on this piece of 
legislation.
    Our bankruptcy laws are an important part of the safety net of 
America. They give those who cannot pay their debts a fresh start. Yet 
bankruptcy should always be a last resort in our legal system. If 
someone does not pay his or her debts, the rest of society ends up 
paying them. In recent years, too many people have abused the bankruptcy 
laws. They've walked away from debts even when they had the ability to 
repay them. This has made credit less affordable and less accessible, 
especially for low-income workers who already face financial obstacles.
    The bill I sign today helps address this problem. Under the new law, 
Americans who have the ability to pay will be required to pay back at 
least a portion of their debts. Those who fall behind their State's 
median income will not be required to pay back their debts. This 
practical reform will help ensure that debtors make a good-faith effort 
to repay as much as they can afford. This new law will help make credit 
more affordable, because when bankruptcy is less common, credit can be 
extended to more people at better rates.
    The new law will also require credit card companies to let card 
holders know up front what they are expected to pay and what the 
penalties they will face if they are late on a payment. When people get 
a credit card, they should not be trapped by a provision in the fine 
print.
    To make the system more fair, the new law will also make it more 
difficult for serial filers to abuse the most generous bankruptcy 
protections. Debtors seeking to erase all debts will now have to wait 8 
years from their last bankruptcy before they can file again. The law 
will also allow us to clamp down on bankruptcy mills that make their 
money by advising abusers on how to game the system.
    America is a nation of personal responsibility, where people are 
expected to meet their obligations. We're also a nation of fairness and 
compassion where those who need it most are afforded a fresh start. The 
act of Congress I sign today will protect those who legitimately need 
help, stop those who try to commit fraud, and bring greater stability 
and fairness to our financial system. I'm honored to join the Members of 
Congress to sign the Bankruptcy Abuse Prevention and Consumer Protection 
Act.

Note: The President spoke at 2:42 p.m. in Room 350 of the Dwight D. 
Eisenhower Executive Office Building. S. 256, approved April 20, was 
assigned Public Law No. 109-8.