The 2005 Bankruptcy reforms?established the requirement that every individual who files a Chapter 7 or Chapter 13 bankruptcy must complete a ?credit counseling? course, or else their petition will be dismissed.? In the case of joint filers, both spouses must?take the course and receive a ?certificate of completion? that is filed with the court along with their paperwork.
In most cases, credit counseling must be completed within 180 days before the bankruptcy petition is filed.? If the certificate is over 6 months old, then the course must be retaken for a new certificate before the bankruptcy can be submitted to the court.? Under certain circumstances, the credit counseling requirement can be waived if the debtor is incapacitated, disabled, or on active military duty in a combat zone. Additionally, it may also be possible to request a deferral of the credit counseling course until after the petition is filed.? However, to receive a deferral the petition must be filed under emergency circumstances, the debtor must be unable to complete the course within 7 days of requesting one.? If granted, the course must be taken?within 30 days of filing the petition.? It is important to note that the grounds for requesting a deferral or waiver of the requirement are narrow, and requests are not frequently granted.
The credit counseling course must be taken through an agency that has been approved by the United States Trustee department.? Depending upon the agency, credit counseling may be completed over the telephone or Internet. Costs may vary between the $30-$50 range, but for those who qualify with limited income the payment may be waived.
If you plan to hire an attorney to handle your bankruptcy, then it is worth inquiring as to whether the cost of credit counseling is included in the costs charged for representation.? Attorneys who frequently represent bankruptcy clients will often have access to order credit counseling through an approved agency ? and often at a lower than standard rate.
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