House Judiciary Subcommittee Approves the National Guard and Reservists Debt Relief Act

HOUSE JUDICIARY SUBCOMMITTEE APPROVES THE NATIONAL GUARD AND RESERVISTS DEBT RELIEF ACT

Washington, D.C.–The House Judiciary Subcommittee on Commercial and Administrative Law today unanimously approved H.R. 4044, the National Guard and Reservists Debt Relief Act, which was introduced by U.S. Representatives Jan Schakowsky (D-IL) and Dana Rohrabacher (R-CA). The bipartisan bill, which currently has 59 cosponsors, would provide relief to financially strapped Reservists and National Guard members. The bill will now move to the full committee for consideration before it can come to the House floor for a vote.

"While every American is feeling the pinch of high gas prices, the mortgage crisis, and a failing economy, National Guard members and Reservists are in a particularly difficult situation because they are unable to anticipate the financial difficulties they might face while they are serving our country,... said U.S. Representative Schakowsky. "Many of these citizen soldiers are pulled away from their families and jobs at a moment's notice, leaving their spouse behind to support their family until they return. The last thing our soldiers should be worried about is if their spouse has enough money to buy gas to drive their kids to school or if their house will be there when they get back from Iraq. We should provide them with financial relief that is worthy of their service and sacrifice to our country....

On October 17, 2005, the Bankruptcy Abuse Prevention and Consumer Act became law, putting new restrictions on the dismissal of debt through Chapter 7 filings. The new law has made it more difficult for members of the National Guard and Reservists to file for Chapter 7 bankruptcy. H.R. 4044 eliminates the means testing under the new law for Reservists and National Guard members called up for more than 60 days of service in the wars in Afghanistan and Iraq, allowing them to file for Chapter 7 bankruptcy under the old rules. The bill is applicable for 18 months after their service has ended.