In 2005 there were some changes made to the Bankruptcy Code that made it harder for people to qualify for Chapter 7 Bankruptcy. The bankruptcy law now requires that you complete two separate credit counseling courses in order to successfully file for bankruptcy. These courses last about an hour and a half and can be taken online.
There are government approved non-profit credit counseling agencies that offer both of the needed courses. Usually they are available to be taken either over the phone or via internet.
Pre-Filing Counseling:
The first course that is required when filing bankruptcy must be completed before the initial petition of bankruptcy is filed with the court. This credit counseling course is meant to help the debtor see what options they have for eliminating their debt. In some cases the debtor will be able to overcome debt without needing to file for bankruptcy. If this is the case a specific plan of action will be made to fit their needs and help them manage debt.
The debtor needs to be able to show a certificate of completion for this pre-filing credit counseling course, otherwise the trustee assigned to their bankruptcy case could throw the entire case out.
Post-Filing Counseling:
After you have filed for bankruptcy and gone through some of the stages there is a second
credit counseling course that you will be required to take. In contrast to the first credit counseling class, the second is designed to help educate the debtor of ways to stay out of debt in the future. The course is aimed at correcting the bad habits that created the situation in the first place, in hopes of reducing the number of bankruptcy filings in the future.
A debtor can expect to learn about budgeting, debt management, using credit wisely, and several other tools to help them succeed after bankruptcy. When you complete the online courses for
bankruptcy counseling the certificate of completion can be emailed to you and/or your attorney, and are usually available within a couple hours of completion. Those looking for the most hassle free way to complete the bankruptcy counseling courses should heavily consider completing the courses online. It will allow them to work at their own pace and on their own time.
