Do all states have different bankruptcy rules and laws?

No, in the United States, bankruptcy is governed by federal laws. This means that bankruptcy rules and legislation will be the same throughout the states, no matter where a person resides. However, depending upon the type of bankruptcy, the amount and type of property that may be what is called "exempt" from the proceedings vary from state to state. Since October 2005, when the Bankruptcy Abuse Prevention and Consumer Protection Act became law, those aspiring to bankruptcy relief must meet a means test to certify that they are not abusing bankruptcy protection.

The means test, based in income, sets incomes that vary from state to state depending on the median income in each jurisdiction. Put simply, people with more than the median income face a steeper climb to be approved for the simplest form of bankruptcy -- liquidation and a fresh start.

Creditors, it should be noted, have judicial and statutory ways to satisfy debts that fall short of bankruptcy. Attachment, wherein the creditor seizes property of a debtor; garnishment, wherein wages are collected to satisfy an obligation; replevin, which allows for the seizing of goods; liens, which are executed against property -- all are statutory venues for the collection of debts.