Debtor Education and Last Minute Chapter 13 Filing

A new client hired me today to stop a foreclosure sale of his principal residence. For the first time since the new bankruptcy law, I examined the issue of getting a debtor education certificate on an expedited basis in time to save a house from foreclosure. Many courts around the country have refused to waive debtor education requirements of the new law prior to filing even if the result of dismissing a bankruptcy without the education certificate is the loss of the debtor’s principal residence. Courts have said that if a debtor tries to complete an education course and after five days is unable to find an eligible course that the debtor can file a certificate to that effect and may obtain a waiver. But, this procedure still requires initial attempts to take an education course at least five days before the Chapter 13 case is filed. People who consider bankruptcy less than five days before foreclosure may find it too late to either take the debtor education class or file a certificate in time to save their homes.

The Orlando Chapter 13 office stated that they may themselves be a certified provider of pre-filing debtor education. If this were the case, local debtors may find it easier to quickly obtain an education certificate prior to filing a last-minute Chapter 13 case. When my secretary checked today and found that the local trustee has not yet been certified as a provider of debtor education. For the time being, debtors will have to seek certification from private providers.

posted by Jonathan Alper, asset protection and bankruptcy lawyer, Orlando, Florida