LUBBOCK — The trauma confronting more than 3,600 Lubbock County families filing for bankruptcy under Chapter 13 in the past five years has been softened by a financial management program provided by the Texas Agricultural Extension Service.
The course has helped the families complete their debt repayment programs, restore their credit and avoid repeating problems that led to their bankruptcy.
The program also has had significant local economic impact. Those filing Chapter 13 bankruptcy may repay up to 100 percent of their unsecured debt, which restores their good credit.
In Lubbock, that repaid unsecured debt was $691,553 in fiscal 1995 alone. That’s good news for creditors.
The Chapter 13 Trustee’s Office in Lubbock says its district’s average percent of payment to unsecured creditors is 50 percent, higher than the 33 percent national average. Nearly 80 percent of Lubbock district filers will complete their repayment plans, compared to 33 percent nationwide.
Extension’s day-long course began in March 1991 and has been conducted once each month since. The first class consisted of 12 couples. Classes now have 100 to 150 couples, said Linda Lynch, Lubbock County Extension agent for family and consumer sciences, who directs the course.
The program came about when Lubbock bankruptcy officials learned that agent Lynch was offering residents training in household financial management and budgeting and wondered if it might help people going through bankruptcy.
Chapter 13 trustee Robert Wilson, Lynch, Kathy Davis, the systems analyst in Wilson’s office, and Dr. Jerry Mason, Extension Service specialist in family management and associate professor of consumer economics at Texas Tech University, developed a proposed curriculum for the one-day workshop.
Wilson then presented the idea to Bankruptcy Judge John Akard. Akard liked the concept so much that he made completion of the course a requirement before couples appear in his court for a ruling on their petition for bankruptcy.
“It was a scary thing, being ordered by the judge to take this training,” says Mrs. Cheryl Pursell, a member of that first class in 1991.
It was comforting to walk into the class and see Linda Lynch there, Mrs. Pursell said. “I’d been to a couple of her programs, and I’d never known her to bite anybody.”
Since she and her husband completed their repayment plan, Mrs. Pursell says she still is using the course materials to help her with her budgeting, goal setting and a family savings plan.
Another benefit was the support of others in the class. “Knowing that there were others in the same situation reduced the social stigma,” Mrs. Pursell said. “It made me feel I wasn’t the only person having trouble with my finances.”