President toughens law on bankruptcy

WASHINGTON -- President Bush signed the biggest rewrite of US bankruptcy law in a quarter-century yesterday, making it harder for debt-ridden Americans to wipe out their obligations.

''Bankruptcy should always be a last resort in our legal system," Bush said. ''If someone does not pay his or her debts, the rest of society ends up paying them."

Many debtors will have to work out repayment plans instead of having their obligations erased in bankruptcy court under the law, which will go into effect in six months. The legislation won final congressional approval last week after being touted for eight years by banks and credit card firms.