Missed Opportunity Or Complete Nonsense? The Post-Filing Financial Management Course Required Of Debtors

My friend and colleague, John Rao, of the National Consumer Law Center, is guest-blogging this week over at Creditslips.com, a academically oriented blog. He writes about the post-filing required financial management course (aka Debtor Education, Financial Managment, the class after bankruptcy, etc.). John’s blog on this subject can be read here.

One of John’s points is extremely important: none of the courses he and his crew reviewed talked about the problems debtors may face when creditors continue to report a balance due on discharged debt and the ongoing need to review credit reports to ensure that creditors are reporting correctly. Why would the “powers-that-be” when given an opportunity to educate debtors as to the problems faced AFTER bankruptcy, instead concentrate, as the courses do, on the difference between “wants” and “needs” and what true rate of interest is?

John had expected that there would be two different courses: one for Chapter 7 filers and one for Chapter 13 filers. This is crucial as the two kinds of bankruptcy have a significantly different impact at the time of discharge. If the Chapter 13 debtor has been paying on time their regular mortgage payments (at least in Oregon, paid outside the Court’s plan), they have already started on the rebuilding process. A separate course with focus on the issues would be helpful. A Chapter 7 debtor has no such rebuilding going on and could use a wider range of subjects in the class curriculum.

If you are post-discharge and your credit report shows balances, please seek immediate advice from an attorney experienced in post-bankruptcy permanent discharge violations through credit reporting (if the attorney you call about this says “huh?”, this is not the attorney you want to consult with!!!)