The term “credit counseling” has been used a lot as of late, but what does it mean when it comes to bankruptcy? The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA) introduced several new provisions including the requirement that a person planning to file for bankruptcy protection complete credit counseling within 180 days before filing. They must also complete a debtor education course after filing to have their debts discharged. The Department of Justice’s U.S. Trustee Program, also referred to as EOUST, approves organizations to provide the mandatory credit counseling and debtor education courses.
Bankruptcy Credit Counseling Certificate
Pre-bankruptcy credit counseling can usually be completed online or by phone, is 60-90 minutes in length, includes an evaluation of your personal financial situation, and a personal budget plan. Through Start Fresh Today's EOUST-approved network of Agencies, the pre-bankruptcy credit counseling includes the following:
- An interactive course you can take from the comfort of your home online or by phone
- Animated, Certified Personal Finance Counselors® to walk you through the briefing
- A useful, informative personal finance tool that is easy to navigate
- The ability to stop at any time – to take a break or to speak with a counselor – and start where you left off
- Customized feedback based on the information you provide
- Electronic delivery of your certificate to you and your attorney
- Courses and support in English and Spanish
Start Fresh Today offers this course for $30, but if you cannot afford to pay the fee, you can request a fee waiver before the session begins. Failure to obtain a credit counseling certificate prior to filing for bankruptcy will result in the dismissal of your case. A discount is also offered if both required bankruptcy courses are purchased as a package.
Second Course: Debtor Education
In a Chapter 7 case, the debtor education post-bankruptcy course (the second course) must be completed after you file your petition for bankruptcy and within 45 days after your meeting with creditors and bankruptcy trustee. In a Chapter 13 case, the second course must be taken after you file your petition for bankruptcy and no later than the last payment you make as required by your bankruptcy plan or the filing of a motion for entry of a discharge under Chapter 1328(b) of the Bankruptcy Code.