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Required Federal Bankruptcy Education Provides Little Benefit Atlanta, GA

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Required Federal Bankruptcy Education Provides Little Benefit

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In 2005, the federal government revamped the process of filing for personal bankruptcy, instituting many new requirements of bankruptcy filers. One such requirement is an education component, which requires would-be bankruptcy filers to participate in a two-hour financial education class aimed at helping people better manage their finances and avoid re-filing in the future. According to a recent study, these federally mandated courses are largely unhelpful for the majority of bankruptcy filers in Georgia and across the country.

The study, which was conducted by University of Iowa law professor Katherine Porter, questioned 2,000 people who filed for bankruptcy in February and March of 2007, finding that just one-third of the study’s respondents believed that the courses would have helped them to avoid future bankruptcy. The largest problem with the courses, Porter said, was that they are completely standardized. Because they are not tailored in any way to the filer’s age, level of education, or reason for filing bankruptcy, they are largely ineffective.

Because it was created in 2005, before the housing and economic crisis that has caused the continuing rise in bankruptcy and foreclosure, the education assumes that most people who file for bankruptcy do so because they have been financially irresponsible. However, Porter says, as the recession drags on, people are more likely to file for bankruptcy for reasons beyond their control. “Teaching people to make different financial decisions can reduce the incidence of financial distress only if the distress is caused by a person’s financial knowledge,” she said.

The filer’s age and education level greatly affects the benefit provided to him by the course. For example, most respondents who stated that they found the course beneficial were under the age of 25 or over the age of 65. In addition, while just 22 percent of college graduates stated that the course would help them avoid future bankruptcy, 36 percent of respondents without a four-year degree considered the information beneficial.

Porter said that age and education level can often be synonymous with the level of knowledge about personal finance, and can have a significant effect on the effectiveness of the course. “It appears that more awareness of their financial plight leads people to perceive less benefit from the financial education course,” she said.

Source: Iowa Independent, “Study: Education for those filing bankruptcy offers small financial benefit”, Lynda Waddington, 8 November 2010

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Jack L.

They did an excellent job with my case. Jamie took the time to really listen and understand things. She delved into the details and was extremely knowledgeable and non judgmental. Very professional and they know what they are doing. Would definitely recommend!

All C.

Mr. Gingold was recommended by an attorney I had worked with previously. I met with Ira Gingold to discuss credit issues. He went over each specific issue thoroughly. He advised me of the potential outcomes. He did all this in one meeting for a very reasonable price. When we finished I was confident in moving forward with a resolution. He definitely wants to help people take the appropriate course of action for their circumstance.

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Dear Mr Gingold, There are so many reasons to be thankful for all you have done and will do. Anyone who has ever had unfavorable experiences with an attorney or the legal system will feel the trepidation that I experienced once I realized that my situation seemed hopeless. It was by chance and happily good luck that I decided to put my future and sanity into your hands. I was mortified at having to deal with my debts by claiming bankruptcy. I remember in our first meeting how you assured me that I was not alone and should not feel ashamed. And, anyone in this position obviously does not have money to spare and you were clear about all the costs and allowing me to pay according to my own ability to do so. You advised me in all aspects of the law, but also, you were at each meeting incredibly supportive and complementary of my personal and professional plans. Anyone else in this situation should feel blessed to have access to your expertise and support.

Lyla B.

I thought the process of filing bankruptcy was going to be a difficult one. However, Gingold & Gingold treated me with respect and dignity from the moment I walked through their door. I had the pleasure of working with Jamie. She is very responsive, professional, and knowledgeable. She took the time and listened to my every concern and handled each and every one of them to my satisfaction. My experience with filing bankruptcy under Gingold & Gingold's representation exceeded my expectations in a major way. They gave me such a peace of mind. I am very pleased with my decision of going with Gingold & Gingold to represent me when I filed Chapter 13 bankruptcy.

Julie T.

Wow! I am finally out of debt and can say that I am debt free after completing my chapter 7 bankruptcy case with Gingold and Gingold. Mr dangled was very knowledgeable and direct with regard to my debt situation. there were no surprises and the case went as I was advised. The staff was also very helpful whenever I had a question. I will definitely recommend them in the future to my friends.

Sherard W.

I cannot say enough about this law firm. From the initial consultation to our discharge, the entire office kept me updated with every step of the entire process. I came to the Gingold after a bad experience with another law firm. Ira and Jamie immediately began treating me like family through this experience. In the end, they assisted with eliminating many debts including my 2nd mortgage. I cannot say enough about the experience and knowledge that Ira brought to the table from the office visits to the court time. Thank you very much for helping me through this tough time. Thank you.

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