Bankruptcy Credit Counseling: What, When, How & Why.
The United States Bankruptcy Code requires consumers who file bankruptcy to complete two financial education courses: These are the pre-filing credit counseling course and the pre-discharge debtor education course.
Individual bankruptcy filers must complete both courses. Business filers, however, are exempt from the requirement.
Debtors who complete the courses receive certificates of completion that must be filed with the bankruptcy court. Only credit counseling organizations and debtor education course providers approved by the U.S. Trustee Program can issue certificates of completion. Your attorney will refer you to approved course vendors. To find an approved credit counseling agency or debtor education provider on your own, click here.
Where Can I Take The Course?
Online credit counseling and debtor education courses are available 24/7, and registration is easy. This allows you to take classes in the comfort of your home. Most counseling agencies offer courses in Spanish; other languages are available, as well. In-person services are available by appointment.
If you are working with an attorney, he or she may provide you with login credentials for a preferred counseling agency. Then, the counseling service will provide your certificates to your attorney in digital format ready to upload to the court’s docket.
During your sessions, you work with a certified counselor to -
complete an in-depth review of your income, expenses, assets, and liabilities,
discuss the right solution for your financial situation, and
develop a workable spending plan, a detailed action plan, and short and long term financial goals.
Take Your Courses at the Right Time.
As its name implies, the pre-filing credit counseling course is completed before you file for bankruptcy. A certificate of completion must be filed with your bankruptcy petition. If you do not complete the course, or if you forgot to include the certificate when you submit your initial paperwork, the court may order you to appear to explain why you ignored the rules. The judge can dismiss your bankruptcy case for non-compliance with the rules. A certificate of completion is valid for 180 days.
The debtor education course can be completed while the case is ongoing but must be filed in court before you receive a discharge.
I’m Too Busy to Take a Course!
Pre-bankruptcy credit counseling takes about one hour. You will review your financial information with your counselor, discuss the advantages and disadvantages of bankruptcy, and evaluate alternatives to bankruptcy, including debt management, to help you determine whether bankruptcy is right for you.
Pre-discharge counseling is the last step in your bankruptcy and, as the name implies, a prerequisite to having your debts discharged.
The course offers financial instruction to help you manage your finances. You will study a variety of material and complete two course tests. You will learn to understand your credit score, manage a budget, and avoid financial risk. The course takes approximately one hour.
To complete your sessions without interruption, gather information about your income, expenses, and debt before you start.
How Much Does Bankruptcy Credit Counseling Cost?
The cost for these services varies, but expect to pay $20 to $50 per person for debtor education services. Consumers below certain income thresholds or working with legal aid organizations may receive free or reduced-price services. If you cannot afford the fee, there is a process for a fee waiver. Read more about fee waivers here.
Take the Counseling & Debtor Education Courses Online!
What Happens Next?
The counseling sessions are just two steps on the road to completing bankruptcy and becoming debt-free. At the Law Firm of Ernest G. Ianetti, Esq. we take our clients’ education seriously. Mr. Ianetti believes clients who understand their finances become successful after bankruptcy. We practice law to help our clients succeed.
Ernest G. Ianetti, Esq., represents clients in Chapter 7, Chapter 13, and Chapter 11 Bankruptcy. Our office is conveniently located in the Rockaway Townesquare Mall complex. We represent clients from Morris County and surrounding areas, including Sussex County, Essex County, Union County, and Passaic County.
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This website and its contents are attorney advertising. The information and materials offered on this site are for general informational purposes only, do not constitute and should not be considered legal advice, and are presented without any representation or warranty whatsoever, including as to the accuracy or completeness of the information. No one should, or is entitled to, rely in any manner on any of the information at this site. Parties seeking advice should consult with legal counsel familiar with their particular circumstances. Communication with the law firm through this website does not create an attorney client relationship. The law firm is a debt relief agency. We help people file for bankruptcy under the United States Code.
