The Bankruptcy Abuse and Consumer Protection Act in early 2005 with the overwhelming support of the president was passed both houses of Congress and the major credit card companies. The law, which radical changes in American bankruptcy law was created adopted to reduce the possibility that consumers Avoid with high debt, choose to pay them seeking debt relief could be avoided by the courts. The law has many provisions, but those who are violatedConsumers most was a provision that was intended to help - the requirement that the debtor seeks mandatory Credit Counseling before filing for bankruptcy.
On the surface, the claim seems that only commendable. Few people ever in any kind of formal money management training, a bit of advice, even when approaching bankruptcy, debtors could help avoid further financial problems in the future. The law was passed with the intention that aftereducated, consumers would enjoy the stay of bankruptcy court in the coming years.
It did not work, that is the case, and the bankruptcy law largely to blame. The law was not to charge for it required credit counseling, but a fee of $ 50 was proposed, and the consumer can not afford to pay the fee can ask to have renounced it. Only certain non-profit organizations would be authorized to prepare bankruptcy counseling advice. These requirements are to be conducted in a messadvice to the industry that benefits as much as anyone. Relatively few agencies have been approved; employs those who are. The proposed fee of $ 50 if paid at all, is not enough to cover the costs of keeping the offices of the agencies the lid open. Consumers are always lands their "advice" over the Internet or a conference call or in a large group meeting. Such things can the requirements of the law to be fair, but it is not to help the people was intended toto help.
Credit Counseling is certainly a worthwhile endeavor, but only if they are properly implemented. The counselor and the client should have sufficient time to meet, discuss an overview of the consultation process and an in-depth discussion of specific financial situation of the client. After all, if the client is no information that he or she can directly apply to receive his own finances, the entire point of providing the service and notcontroversial.
Instead, we have a situation where the customers are poorly served and advice agencies are financially without scratching. It seems unlikely that this Congress that what they had in mind when they passed the bill. Who would be a problem with debt certainly has the benefit of advice and know to look for it. Had those who were not advised to choose a counseling agency that the time and resources to provide detailed naturehelp of which a client can even benefit. Otherwise, the result is a waste of time for all involved.
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