Bankruptcy Credit Counseling Requirements

Thanks to Attorney Tobias Licker in St. Charles for this guest post.

 
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 requires all debtors to complete a credit counseling course by an approved provider within 180 days before filing for bankruptcy. Counseling is required for both Chapter 7 and Chapter 13 bankruptcy. A completion certificate must be received with your bankruptcy petition. If this is not completed the U.S. Bankruptcy Court will dismiss your petition. Then, before your bankruptcy case can be discharged, you must take another credit counseling course. That course will focus more on debt management and budgeting.
 

Finding an agency:

 
You can log onto the United States Trustee’s website to find an approved counseling agency in your area: www.usdoj.gov/ust. Look under the credit counseling and debtor education tab.
 
 

Pre-Filing Counseling:

 
The pre-filing course will include an overview of your financial situation and possible alternatives to bankruptcy. A counselor may create a personal budget for you. If the counseling agency creates a repayment plan for you, it must be submitted to the court. You may not be required to follow it, but it must be submitted for viewing.
 
The pre-filing counseling course usually costs between $15 and $50. If you are not able to pay the fee, you can sometimes obtain a fee waiver from the office beforehand. After you have completed the course you will receive a certificate. Beware of agencies that try to charge for this document. An approved agency will not charge for a certificate.
 
 

Pre-Discharge Counseling:

 
Before your bankruptcy can be discharged, you must complete the pre-discharge counseling program, which covers budgeting, and debt management. These sessions are typically longer than the pre-filing counseling sessions and cost between $15 and $50. This fee can also be waived if you are unable to pay. A waiver must be submitted and approved before taking the course. Your completion certificate must be filed with the court before your petition can be discharged.