Since BAPCA was passed in 2005, consumer debtors filing bankruptcy cases have been required to take post-filing classes in financial management (a.k.a. budgeting, or what old grumps like me knew as “home economics”) before getting a discharge of their debts.
Most debtors take these “courses” in a single session, either online or over the telephone.
Uncle Sam uses both a carrot and a stick to enforce this part of the law: if you don’t finish such a course, you will find your case dismissed without getting the discharge you craved.
Atlanta bankruptcy attorney Jonathan Ginsburg has written an article on what it will cost you to get your case back into the system if you “forget” to take the course.
Attorney Ginsburg charges $240 for the legal work to restart your case; I typically charge $300. Add to that the court’s fee of $260 for re-opening a case, and ouch, its much better to take that course on time in the first place!
Chapter 7 debtors have 60 days from the first meeting of creditors to finish their education requirement. Note that if the meeting is adjourned, or there are multiple meetings, debtors don’t benefit — the deadline runs from the first section 341 meeting.
Chapter 13 debtors need only do it before their plan is completed, which is often years down the road. So no pressure there, but also a good likelihood that they forget about the whole thing and end up in a panic anyway.
By Doug Beaton