Bankruptcy filings in the US have skyrocketed ahead of the implantation of a new bankruptcy law.

The New York Times reports under the revised law, signed by President George W Bush in April, debtors who earn more than the median income in their state and who can repay at least $6 000 of their debt over five years will no longer be able to have their debts wiped out for a fresh start under the more generous provisions of Chapter 7 of the bankruptcy code. Instead, they will have to seek protection under Chapter 13, which requires a repayment schedule. In addition, under the new provisions, they will have to enrol in a court-supervised financial counselling programme.
Full report in The New York Times