This article provides an in-depth discussion of the current mortgage and credit crisis in relation to the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 which significantly changed bankruptcy practice in the US and makes restructuring harder to accomplish. The Act also was intended to provide additional protections for financial participants, such as issuers of the structured financial products that provide the principal financing to today’s subprime mortgage lenders; as the subprime market collapses, however, the effectiveness of these protections is being tested.

Walter H. Curchack is the chair of Loeb & Loeb LLP's Bankruptcy, Restructuring and Creditors' Rights Practice Group. He is based in the New York office and can be reached at .

This article first appeared in the November 2007 edition of Financier Worldwide. Copyright 2007 Financier Worldwide Limited. Permission to use this reprint has been granted by the publisher.