Anyone filing for bankruptcy must complete a court-mandated credit counseling course. This must be completed within 180 days (6 months) before filing of the case. The requirement is included in Section 109 of the U.S. Bankruptcy Code. The counseling must be provided by an agency approved by the U.S. Trustee Program, which is part of the Department of Justice.
What to Expect During Credit Counseling and Debtor Education
The credit counseling process is very simple and will not require more than 1-2 hours of your time. The course can be taken online or over the phone based on your preference. During the course you will go over your income, assets and debts. At the completion of the course, you will receive a certificate. This certificate will be submitted to the court when your case is filed.
In addition to the pre-bankruptcy credit counseling course, you must receive debtor education after you file for bankruptcy.
This course must be taken before your case is discharged. The certificate received upon completion will be filed with court. Most organizations that provide pre-bankruptcy credit counseling offer this service as well.
This requirement, mandated by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, aims to ensure debtors understand their financial situation and explore alternatives to bankruptcy before proceeding. Usually by the time clients take the course, they have no alternative but to file bankruptcy. The course can seem like more of a task than a learning tool.
Attorney Shari Lynn Stevens has worked extensively with residents of Northeastern Wisconsin to secure their financial freedom through filing Chapter 7 and Chapter 13 bankruptcies. She also advocates and represents disabled clients in their Social Security disability claims.
