Many of our clients are surprised to hear that they are required to take a credit counseling and debtor education course during the process of their bankruptcy. The bankruptcy court requires that all bankruptcy filers complete a pre-bankruptcy credit counseling course, and a pre-discharge debtor education course.
Credit Counseling Course
The first course is the credit counseling course. This course needs to be completed before a bankruptcy case can be filed. Debtors should anticipate this course to take about an hour of their time to complete. There is no “pass” or “fail”, only participation points. Upon completion, your approved credit counseling course provider will issue a certificate of completion that you will need to provide to your attorney. Keep in mind, credit counseling course certificates do have an expiration date of 180 days. If your case is not filed before the expiration, you will have to take the course a second time. If you are filing with a spouse, both of you will need to complete the course.
The First Course
The first bankruptcy course will cover money management, budgeting, budget counseling, and a review of your net worth. There will also be a discussion of the factors that led to your financial difficulty and suggestions on how to overcome those struggles in the future.
The Second Course
The second course needs to be completed shortly after your bankruptcy case is filed and preferably prior to your meeting of creditors. In order to complete the second course, you will have to have your case number. If you do not complete this course by the deadline provided by the court, your case can be dismissed and you will not receive a discharge of your debts. In the event this happens, you would have to re-file your case in order to obtain a discharge. The second course will cover personal financial management.
For more information contact your Modesto bankruptcy attorney at 209-438-4990.