Bankruptcy question

[The Captain]

Question for those of you who have gone through or are currently going through bankruptcy. In a few recent threads a required? online class has been discussed.

I'm curious, what is the class about? What does it cover? Is it required in all states? Is it supposed to teach financial skills so BK doesn't happen again? Basically, what is the purpose? Is there any way to get out of it? I mean in some cases (major medical bills, long term job loss) there's really very little that could be done to avoid BK, right?

The reason I ask is I had a relative file for BK a long time ago, then again as soon as he was eligible. The guy had no financial skills whatsoever and it took him until his early 40's before he finally *got it*. A class may have helped.

[Deleted]

My deadbeat tenants were required to take a course on financial management as part of their bankruptcy process.

Didn't seem to help since a year later instead of paying their rent to me and down sizing they took that money and put a deposit on a house where the rent was 50% more expensive ($2700 to $4000) and cashed in her 401k to do it.

[kindthatjingles]

It was a basic budgeting and finance class.( There was one during and one after in order to file for the discharge.)

Like what percentage should be used for housing etc.

It was  very general personal Finance.

You have to spend so much time doign the class for it to count I think it was at least an hour.

I read it all and followed the directions. There was a test at the end.

[The Captain]

I appreciate the answers. In general, it sounds like a beneficial class.

Sounds like something that should be part of a required HS course load.

In my area kids are required to take a class on cultural sensitivity but are not required to learn how to balance a checkbook.

Course, not sure how many people still write checks these days....

[thyme4change]

I hear the class is very, very basic.  I also hear that many judges are lax about when you complete it.

[Deleted]

Captain,

Are you sure personal finance isn't covered in an economics course while in high school?  Our kids do a huge project that includes checking out grocery store prices, finding a place to live that they can afford, etc.  I think most schools do a unit on this . . . at least in Alabama.

[Angel!]

Feb 11, 2013 14:10:40 GMT -5 kindthatjingles said:

It was a basic budgeting and finance class.( There was one during and one after in order to file for the discharge.)

Like what percentage should be used for housing etc.

It was  very general personal Finance.

You have to spend so much time doign the class for it to count I think it was at least an hour.

I read it all and followed the directions. There was a test at the end.

Hey Kindthatjingles!  Good to see you.  I hadn't seen you posting in quite a while & was wondering if you had left the boards.
 

[Clever Username]

I also hear that many judges are lax about when you complete it.

Actually, no.
On your 341 notice will be a date listed as "Final date for creditors to object."
Do it by that date or your case gets dismissed without discharge.
I guess the lax part is that they don't enforce the rule that it's technically due about two weeks after your 341 meeting.

FYI - the post-filing class is called Debtor Education.

[973beachbum]

Feb 11, 2013 14:34:34 GMT -5 @southernsusana said:

Captain,

Are you sure personal finance isn't covered in an economics course while in high school?  Our kids do a huge project that includes checking out grocery store prices, finding a place to live that they can afford, etc.  I think most schools do a unit on this . . . at least in Alabama.

NJ does too.  It is called Fincial Literacy and is half a year long.  The other half of the year is in technology teaching them how to search things on the internet and write paper on the computer.

[garion2003]

'writing checks'...how quaint

[Peace77]

My high school taught nothing about financial literacy or money management.  I've made some mistakes but I have never filed bankruptcy.

Some high schools are now teaching a Dave Ramsey class called Foundations for Finance.
The Dave Ramsey website also offers an online debt education class for people filing bankruptcy.  

I know of one family that has filed BK 3 times and has been bailed out by family members and inheritances and still lives on the edge of ruin.

[michelyn8]

Feb 11, 2013 13:44:45 GMT -5 The Captain said:

Question for those of you who have gone through or are currently going through bankruptcy. In a few recent threads a required? online class has been discussed.

I'm curious, what is the class about? What does it cover? Is it required in all states? Is it supposed to teach financial skills so BK doesn't happen again? Basically, what is the purpose? Is there any way to get out of it? I mean in some cases (major medical bills, long term job loss) there's really very little that could be done to avoid BK, right?

The reason I ask is I had a relative file for BK a long time ago, then again as soon as he was eligible. The guy had no financial skills whatsoever and it took him until his early 40's before he finally *got it*. A class may have helped.

When I was toying with bankruptcy a couple of years ago, I went ahead and took and "online class" for the first part as I was gathering my documentation since that certificate of completion was on the list of things the lawyer needed to start the application.  It was a joke.  It taught me nothing and to be honest, I could learn more from reading YM.  It was nothing but the boilerplate you read in most financial articles about budgeting and saving. 

I would think an in-person, multi-class course would be more suitable for someone who is in financial straits and needs to learn better financial skills.  Something with homework and the provides an opportunity to ask questions.

[Clever Username]

The first class, pre-filing is not for financial skills.
File it in the good idea / poor execution pile.
It's mean to be Credit Counseling.

An outside, uninterested 3rd party is supposed to lead the not-really-bankrupt to other options instead.

Realistically, it's item 12 on the checkoff list of paperwork needed to file a bankruptcy.

The really stupid thing is there's a second rule.
You cant take this class on the same day you file the cases.
Ya know, because you need a day to think about it afterwards.

[Opti]

Feb 11, 2013 13:44:45 GMT -5 The Captain said:

Question for those of you who have gone through or are currently going through bankruptcy. In a few recent threads a required? online class has been discussed.

I'm curious, what is the class about? What does it cover? Is it required in all states? Is it supposed to teach financial skills so BK doesn't happen again? Basically, what is the purpose? Is there any way to get out of it? I mean in some cases (major medical bills, long term job loss) there's really very little that could be done to avoid BK, right?

The reason I ask is I had a relative file for BK a long time ago, then again as soon as he was eligible. The guy had no financial skills whatsoever and it took him until his early 40's before he finally *got it*. A class may have helped.

My understanding is it was part of the changes in the bankruptcy laws in the 2005 revision. Have no idea whether the requirements
vary or not state by state.

In NJ, it is not optional. My first online course which needed to
be completed prior to filing had a very detailed breakdown for a budget. Whether it helps or not really depends on your situation.
Mine was mostly due to repeated job loss and steps down the income ladder, i.e. 90K to almost $40k/yr to not even $15K/yr.
Sometimes it is just fate and Math and you need to move on.
(And plot your revenge for when you make $120-$200K/yr.... )

[kindthatjingles]

Feb 11, 2013 14:36:24 GMT -5 Angel! said:

Feb 11, 2013 14:10:40 GMT -5 kindthatjingles said:

It was a basic budgeting and finance class.( There was one during and one after in order to file for the discharge.)

Like what percentage should be used for housing etc.

It was  very general personal Finance.

You have to spend so much time doign the class for it to count I think it was at least an hour.

I read it all and followed the directions. There was a test at the end.

Hey Kindthatjingles!  Good to see you.  I hadn't seen you posting in quite a while & was wondering if you had left the boards.
 

Thanks Angel! I lurk a lot now..... It seems like everyone one here is beyond where I am in my life.... It seems really like Facebook now rather than financial help or stories... I watch for you Firebird Dark Caiwau and Swamp, but have mostly been over at Smart spending or Women in Red..They are not as active though