Congress intends to tighten the screws on middle-class bankrupts. Legislation being considered in House and Senate committees would stop people from discharging their debts if a judge believed they could pay at least some of their bills.

Creditors say the change will lower the number of bankruptcies. A record 1.4 million households filed last year.

The proposed law, however, will have another effect. Lenders will shovel even more credit at high-risk people, if they know it’s harder for debtors to walk away. Delinquencies will go up, not down. Let’s face it: There’s shared blame for the high bankruptcy rate.

On the debtor side, some folks are spendaholics (I leave out the “honest bankrupt,” driven by unemployment, business failure or huge, uninsured medical bills). On the lender side, it’s profitable to extend credit to marginal borrowers at high rates of interest.

Creditors brandish a study, claiming that 25 percent of the bankrupts are abusing the system. They could repay at least 30 percent of their credit-card debts, the creditors say, and therefore shouldn’t be allowed to go bankrupt.

This study, however, underwritten by Visa and MasterCard, has come in for withering criticism. Many academics as well as the government’s General Accounting Office have trashed its methodology and conclusions.

The actual portion of abusers is believed to be much lower, but no one knows how much. Bankruptcy filers tell the court what their income and assets are, but it’s rare for anyone to check. Some misrepresent their true financial picture.

How to deal with abuse in the system is a difficult question. Judges already have the right to refuse bankruptcy petitions that don’t seem to be justified.

In 1994, Congress created a National Bankruptcy Review Commission to recommend improvements in the bankruptcy law. By a 7-2 majority, the commission rejected the creditors’ wish for additional roadblocks to bankruptcy.

Blocking people from discharging their debts would fall the hardest on families already pressed past the breaking point, says Harvard law professor Elizabeth Warren, an adviser to the commission.

The commission would tighten the process in two other ways: (1) Require random audits of filers, to see if they’re telling the truth about their financial position. (2) Stop people from filing serial bankruptcy petitions, simply to hold off creditors for a few months more.

Edith Jones, a judge for the U.S. Court of Appeals in Houston and a member of the commission’s minority, backs means-tested bankruptcy: a test of every applicant, to see if there’s any more money he or she could pay.

That’s the road Congress is taking. The bill in the House, sponsored by Rep. George Gekas, R-Pa., would effectively create a budget for middle- and higher-income

bankrupts. It would use the low spending allowances set by the IRS when setting up tax-payment plans.

If that budget determined that you should be able to pay your secured debt (mortgage, car payment), plus priority payments (child support, back taxes), plus at least 20 percent of your unsecured debts, you would not be allowed a Chapter 7 bankruptcy, which eliminates most unsecured debt. Instead, you’d have to enter Chapter 13. There, you must pay some portion of your unsecured debt (mainly credit cards) over three to five years.

The Senate bill, sponsored by Sens. Charles Grassley, R-Iowa, and Richard Durbin, D-Ill., lets a judge move you from Chapter 7 to Chapter 13, based on assertions from your creditors that you could pay.

This would catch some abusers who could pay out of future income. There’s a big risk, however, that such a provision would be used too aggressively.

Some creditors violate even the current bankruptcy law, which is intended to give hopeless debtors a fresh start. They threaten, intimidate and try to collect more than the law allows.

Using the new law, they could push desperate people into Chapter 13 and intimidate them more, perhaps with small chance of collecting much, if anything. On paper, these creditors could be fined; in practice, it would rarely happen.

Ironically, Congress isn’t doing much about an abuse that’s typically used by the “bankrupt” rich. A home of any value can be exempted from bankruptcy in five states (Texas, Florida, Iowa, Kansas and South Dakota). Some famous bankrupts have stashed all their cash in mansions, leaving their creditors high and dry.

Congress would require a one-year residence before using this ploy, up from six months today. But the loophole itself survives.

Creditors equally to blame

With bankruptcies at record levels and delinquencies near all-time highs, you’d think that all of America was in credit hell. But you’d think wrong.

Most borrowers are doing fine and will manage even if the economy dips, says Sandra Shaber, executive vice president of global markets for the WEFA Group in Philadelphia.

Some people do indeed over-borrow. But there’s no reason to think there’s a larger-than-usual portion of spendaholics today.

The new risk lies with the growing number of borrowers who haven’t had much credit before. Competition among lenders, plus the good economy, are encouraging lending to financially marginal groups. Many of these individuals will also use their opportunities well, but they are more vulnerable than others when a downturn hits.

Careful lenders work hard at finding the better prospects among these new borrowers. But those customers may go under, too, if they’re later overloaded with credit by irresponsible lenders.

Credit-card issuers mailed out 3.1 billion solicitations last year ? 30 for every American household. When there’s over-borrowing, lenders are equally to blame.

Syndicated columnist Jane Bryant Quinn can be reached in care of the Washington Post Writers Group, 1150 15th St., Washington D.C. 20071-9200.