The jury will be out on the overall impact of the new law for years to come. But a growing number of fed-up bankruptcy judges aren't waiting for history's verdict.
"Too many Americans are just financially illiterate," says Ninfo. "Many of the people who come through this court who say they've had a catastrophic event, if you really analyze it, they had no savings, lived paycheck to paycheck, had a lot of credit card debt. And when a blip on the radar screen comes along, they can't sustain it."
Ninfo energetically argues his case. He grabs a folder. It's the file of a teacher making $72,000 a year. She's about to file for Chapter 13.
"I know from her schedules that she's divorced and has two teenage girls and isn't at this point getting any child support or alimony. But here is a person who has been working as a teacher for more than 20 years. Has a good salary. But she has $35,000 in credit card debt. Her budget that she has to put together as part of her bankruptcy filing, at least at this point, shows that she doesn't have a penny of disposable income. So how could she have ever paid the $35,000 in debt? "
He reaches for another file. This one is from a couple with an income of over $60,000.
"One of the spouses has been working at one of our bigger employers in Rochester for 37 years," says Ninfo. "And they have $54,000 of credit card debt, almost their annual income in credit card debt. They have not one penny of disposal income. To have borrowed $54,000 and being able to repay it over 36 months, they'd need over $2,000 a month in real excess income over their expenses."
Empathy doesn't seem part of Ninfo's vocabulary. He's a former Marine. His office is crowded with American eagles and military mementos.
"People say to me, 'Well, why are you so tough?' Even my own father said this to me one day after sitting in on court. I said, half jokingly, 'Well, I'm a Jesuit-educated, Marine Corps-trained Sicilian, so I guess that's what you get.'"
But then Ninfo reveals a different side.
"I see far too many people who I look at and it hurts me. Because I think if they knew more about finances and had structured their lives a little differently they wouldn't have needed to be here."
Ninfo isn't one to sit around. He decided to battle financial trauma with CARE, a program he created four years ago. The name stands for Credit Abuse Resistance Education-sort of a "Scared Straight" credit program for students.
He explains, "What I tell the young people every day is, 'If you do not improve your financial IQ and if you don't learn these things, they will take advantage of you in the consumer credit and service industries every day in as many creative ways as they can. They'll take as much of your money as many times as they can, and no one really cares.'"
He started in local high schools and colleges. Now he's convinced judges, trustees, and lawyers in 28 states to volunteer in schools, bringing real-world stories from bankruptcy court to kids getting their first credit card offers.
Continue to part 3