What Happens if I Fail to Complete a Financial Management Course

I periodically receive emails from bankruptcy debtors who write me in a panic because they failed to complete their financial management course.  As you may know, the Bankruptcy Code requires debtors to attend a financial management course within 45 days of their 341 hearing in order to receive a discharge.  This applies in both Chapter 7 and Chapter 13 cases.

If you do not complete the financial management course, your case will be closed but no discharge entered.

This financial management course is a bit confusing because it represents the second required course for debtors.  Prior to filing, debtors must attend a credit briefing course.  I have had several folks tell me that they did not understand that they were obligated to attend two separate courses - one prior to filing and one afterwards.

Recently a nice lady who had filed with another law firm wrote me to say that her 341 was 6 months ago and that no one told her about the second course.  My advice to her is as follows:

1. contact your lawyer immediately to see if the case has been closed.  If not, take the financial management course as soon as possible and have the attorney file the certificate - you may have dodged a bullet.  In my practice (Northern District of Georgia), the 45 day requirement has not been an issue as long as the course completion certificate is filed before the case is closed.

2. if the case was closed, most judges will permit the debtor to reopen the case for the purpose of filing the certificate.  There will be a filing fee to reopen the case (I think the filing fee will be around $200) and I suspect that the responsibility for paying this fee may be an issue between you and your lawyer.  I can tell you that most lawyers who routinely file bankruptcy have procedures to remind their clients about the financial management course requirement, so it may be an uphill battle to convince your lawyer to absorb this cost.