Credit Counseling Agencies Create Complex Financial Issues
BAPCPA mandates debtors participate in credit counseling briefing prior to filing bankruptcy and a debtor education course before the bankruptcy discharge. The increase in clients demanding these services has caused agencies to spring up in what could be unexpected places, according to a recent article in Seattle Weekly.
Nonprofit foundations like the North Seattle Community College Foundation, created to raise money for the college, has become a multi-million dollar credit counseling agency over the past seven years, but little of its profits are finding their way back to the organization it was initially designed to support.
From 1998 through June 2004, for example, the Seattle foundation took in $233.6 million and contributed only 1.2 percent of that to grants and scholarships.
Agencies including this one are drawing attention from the Senate, which finds in part that the foundation isn't even providing debtors much help.
