Bankruptcy Articles

Credit Counseling is Required

Before you can file a chapter 7 or 13  case you must complete a credit counseling info briefing from an approved credit counseling agency. This approval must come from the executive office of the United States Trustee.The briefing can be done over the telephone or over the internet.  The internet briefing takes approximately 20 minutes to complete.  Once you complete the briefing, then a certificate of credit counseling is sent to you and to your attorney by fax or by e-mail.

If you do not have internet access, then you can take the info briefing over the telephone. I have yet to have a client decide not to file for bankruptcy as a result of the credit counseling briefing.  It was the Congress hope that many would decide not to file bankruptcy after receiving the briefing.  They had hoped that debtors would enter into a non‑bankruptcy debt repayment plan instead.  This would greatly benefit the creditors, specifically, the credit card companies.  The reality is that the credit counseling briefing is simply taking $50 out of the pocket of debtors.  That money is not reaching the creditors, but rather, the credit counseling agency.

The credit counseling briefing seems to be just another hurdle that honest debtors must jump in order to receive the fresh start that they deserve. Credit counseling is simply designed to make filing for bankruptcy more of a hassle. If you are extremely poor, then some credit counselors may reduce or waive their fee. I usually recommend the company called Money Management to conduct the credit counseling briefing. They offer prompt service and they always fax or e-mail the certificate of credit counseling to my office. They are a very reliable company. In summary, the consumer credit counseling requirements to file for bankruptcy is not as burdensome as it may first sound. It usually only takes about twenty minutes. Moreover, it only costs $50. Therefore, don’t let this requirement scare you from filing for bankruptcy. It really is just busy work that is designed to aggravate debtors and consumer bankruptcy lawyers. The credit card companies actually created this requirement for the new 2005 Bankruptcy Reform Act. The bottom line is that if you need debt relief, and if your financial circumstances are real, then you will be granted debt relief once your bankruptcy case is finished.

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