Did the new bankruptcy laws lead banks to be overconfident with lending and to the mortgage/credit crisis?

Washington Mutual Inc. got what it wanted in 2005: a revised bankruptcy code that no longer lets people walk away from credit card bills.

The largest US savings and loan didn’t count on a housing recession. The new bankruptcy laws are helping drive foreclosures to a record as homeowners default on mortgages and struggle to pay credit card debts that might have been wiped out under the old code, said Jay Westbrook, a professor of business law at the University of Texas Law School in Austin and a former adviser to the International Monetary Fund and the World Bank.

http://www.boston.com/business/personalfinance/articles/2007/11/11/shift_in_bankruptcy_laws_staggers_mortgage_holders/

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