It’s no secret that the BAPCPA changes in 2005 were intended to impose more requirements on bankruptcy debtors before they could file a bankruptcy case. One of these changes was the implementation of a requirement that debtors must take two credit counseling courses.
Federal law requires the completion of two credit counseling classes, one before filing, and one after filing but prior to the completion of the bankruptcy case.
The second post-filing credit counseling course is essential. Without it, a bankruptcy debtor will not receive his or her discharge order, which is the ultimate technical reason an individual files bankruptcy.
The amount of time it takes for a bankruptcy debtor to receive a discharge in a bankruptcy case varies from 3-6 months in a Chapter 7 case and from 3-5 years in a Chapter 13 case. No discharge order will be issued until both courses are completed. Note that a potential debtor may not file a bankruptcy case until the first course is completed.
The purpose of the credit counseling courses is to require prospective bankruptcy debtors to exhaust all other options before filing bankruptcy. The course makes debtors review their personal finances and consider alternatives to bankruptcy. The pre-bankruptcy course also helps debtors learn how to create a budget. The credit counseling requirement also aims to decrease the likelihood that a prospective debtor will file bankruptcy yet again after the currently proposed filing.
If you are seriously considering the filing of a bankruptcy case, you must complete a credit counseling course within 180 days of the bankruptcy case filing. Then, a second course on debt management must be completed. Otherwise, you will be ineligible for a discharge and you will remain legally obligated for the payment of your debts.
Pre-bankruptcy and post-bankruptcy credit counseling classes are available in-person, online, and even over the telephone. Although typically difficult to obtain, a waiver of the fee may be available to some debtors before course registration. Once the credit counseling course is completed, a debtor will receive a certificate that must be filed with the court.
The Morrison Law Group can help if you need to discuss your bankruptcy options. An experienced and knowledgeable bankruptcy attorney like Theron Morrison will inform you of your rights so you may determine whether bankruptcy is your best option. Then, if bankruptcy is indeed your best option, will file your case and provide seasoned, quality representation. Call 801.456.9933 today to schedule a FREE consultation. We have locations in Ogden, Logan, Sandy, and St. George to serve the residents of the counties of Weber, Cache, Salt Lake, Utah, Morgan, Davis, Washington, and surrounding areas.