Department of Justice Waives Credit Counseling Requirement for Katrina Victims (Means Test still applies)
Although the US Trustee Directive waives the requirement related to credit counseling and debtor education, the Means Test provisions still apply. The practical issue with this is that a consumer hit by Katrina, with above median income for the last six months, will still be subject to Means Testing, possibly disqualifying the consumer from chapter 7 relief. Bottom line is that the new bankruptcy law considers all income over the last six months, while Katrina victims need a law that realistically considers only current income.
As a reminder of how ridiculous it would be for Katrina victims to fulfill the credit counseling requirement anyway, it's worth mentioning that there aren't any UST approved agencies in LA or MS:
"13 offices have been approved to provide counseling for Louisiana filers, but none is located in Louisiana. They say telephone and Internet counseling is available where in-person counseling is not. Five offices have been approved to provide counseling in southern Mississippi, although none are located in Mississippi." - ASSOCIATED PRESS
NYTimes Members see original article: Bankruptcy Law Provision Waived for Storm
Department of Justice Press Release: Download file
