In Search of a Fresh Start: Can Credit Counseling Help Debtors Recover from Bankruptcy? NFCC Webinar May 12, 2010. Introductions. Dr. Angela Lyons Associate Professor University of Illinois (217) 244-2612 [email protected] Shawn Howard Statistician
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Can Credit Counseling Help Debtors Recover from Bankruptcy?
May 12, 2010
“The counseling places undue hardship on debtors who are already overwhelmed financially. It’s an administrative obstacle to those who really have no other option but to file for bankruptcy.”
“The counseling has educational value. Repealing this requirement would prevent debtors from getting the knowledge and skills they need to better manage their finances and build future financial security.”
Track debtors through the entire bankruptcy process and follow up with them to assess impacts of counseling and education requirements.
Credit Counseling Session
Consumers who seek out credit counseling generally fall into one of three categories:
General Credit Counseling
Kim, Garman, and Sorhaindo (2006), Xiao, Sorhaindo, and Garman (2006), Xiao and Wu (2006).
Elliehausen, Lundquist, and Staten (2007), Staten and Barron (2009).
Ramsay (2002), Schwartz (2003).
Thorne and Porter (2007), NFCC (2006), Lyons, White, and Howard (2008).
An overview of MMI’s online course:
Step 1: Descriptive Analysis
Step 2: Regression Analysis
Variables included in regression models:
Almost all debtors seemed to appreciate the educational value of the counseling and did not feel that the requirement had been a burden or an administrative obstacle.
A “one-size-fits-all” approach
may not be ideal for all debtors.
What happens after bankruptcy?