HR 3609, a bill now waiting for approval in the House, would ease some of the burden for debtors trying to file for Chapter 13 bankruptcy to avoid foreclosure.
Currently, one of the eligibility requirements for Chapter 13 bankruptcy is the completion of a credit counseling course prior to filing. For those who want to file for Chapter 13 as an emergency measure to prevent foreclosure, though, there isn't always time to complete the course.
The bill would provide an alternative for debtors in danger of losing their homes: by presenting proof that foreclosure proceedings have begun on their primary residence, they could waive the credit counseling requirement.
Some consider this revision necessary, since many debtors have lost their homes and cars because of an inability to complete the counseling course in time. If accepted as currently written, the bill will also include a lengthened allowable repayment period for any debt secured by the borrower's home.
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