The federal bankruptcy law now requires anyone who wishes to file Chapter 7 or Chapter 13 to obtain a credit counseling certificate prior to filing. The purpose of credit counseling is to help potential bankruptcy filers learn about alternatives to bankruptcy. In reality, however, credit counseling has not changed filing rates very much – only a tiny percentage of individuals who complete the mandatory credit counseling manage to avoid filing bankruptcy. Nevertheless, you must have a credit counseling certificate before you will be allowed to file.
Second Credit Counseling Course You Must Take After You File
After you file, you must take a second course and obtain a second certificate. This second course is called the “financial management course” and is designed to offer you guidance regarding budgeting and money management. Many credit counseling vendors offer courses on-line or over the phone. Some vendors offer live classes. Pre-bankruptcy counseling will take between 45 minutes and two hours and your certificate will be good for 180 days. Most credit counseling vendors charge between $35 and $50. Most charge only one fee for joint counseling for a husband and wife. The financial management course will also cost you between $10 and $50.
If you think that bankruptcy may be an option, I recommend that you go ahead and take the course and get your credit counseling certificate. If you are faced with a filing emergency and can’t get a counseling session scheduled, you will have to wait to file. The wording of the credit counseling law also suggests that you cannot file on the same day as you obtain counseling. This issue is not yet settled, but to be safe, you are better off taking the course and obtaining your certificate prior to the day you actually file. Once you file, I recommend that you obtain your financial management course certificate as soon as you can. This certificate needs to be filed with the clerk of court. If your case closes without a filed financial management certificate, you will not receive a discharge. You will then need to reopen your case to get the financial management certificate filed. Most people take their classes over the Internet, or by phone. Here are several credit counseling and financial management course vendors to contact. Unless otherwise indicated, these vendors offer both the pre-bankruptcy credit counseling and the post-filing financial management course:
- Clearpoint (formerly Consumer Credit Counseling
- 123debtor.com – (personal financial management course only) – $9.89 per person, $16.69 per couple
- Abacus Credit Counseling – $25 per individual or couple
- Access 24/7 Credit Counseling – $15 pre-filing; $9 post-filing financial management; 800-210-0522. Use attorney code SB12861
- BothCourses.com – $8.75 for pre-filing credit counseling; $7.99 for pre-discharge credit counseling. Telephone courses available as well at 1-844-378-3059. Use attorney code FRSB428.
- CC Advising – $9.76 per person for pre-filing course
- BE Adviser – $9.76 per person for post-filing course
- Hummingbird Credit Counseling – $49 for certificate, but fee waiver available to those who qualify
- Institute for Financial Literacy – $50 per case, single or joint
- Pioneer Credit Counseling – $12 for pre-bankruptcy counseling and $10 for post-filing financial management course. Reference Attorney number 11745
- DebtHelper.com – $24 for pre-bankruptcy counseling, $14 for post-filing financial management course. Same cost: single or joint filings. Spanish language courses available (800-920-2262). Use code “GA0122.”
- Dollar Learning Foundation – $20 for pre-bankruptcy counseling; $20 for post-filing financial management course. Use attorney code S4286B.
- A 24-7 Class (personal financial management course only)
- Academy of Financial Literacy (10.95 per household for pre-bankruptcy counseling or personal financial management course)
- DMCC – $50 for single or joint pre-bankruptcy counseling, $25 for single or joint pre-discharge financial management course (954-418-1466)
- MoneySharp – $10 per household for single or joint pre-bankruptcy counseling or post bankruptcy financial management course (use code JGINSBERG)
- YourBankruptcyPartner.com – $50 per case, single or joint
- Allen Credit & Debt Counseling Agency – offering 24 hour per day counseling Sunday through Thursday and late hours Friday and Saturday – cost is $50 for pre-filing certificate and $50 for Financial Management course – single or joint. Use attorney code JG7824.
- Personal Finance Education – $30 for pre-filing certificate; $25 for Financial Management course certificate; call 800-729-0049
- Chapter 13 Trustee Nancy Whaley – free financial management course and certificate for Chapter 13 debtors whose cases are assigned to trustee Nancy Whaley. Nancy uses the Dave Ramsey materials.
- The Mesquite Group – $30 for pre-filing certificate/$40 for couple. $12.50 for post-filing financial management course and certificate
- InCharge Educational Foundation – $30 online pre-filing certificate, $50 telephone pre-filing certificate; $25 online or telephone post-filing financial management certificate
- Start Fresh Today – $59 for both courses (use code SFTPromoM59) for discount.