What Is Bankruptcy Debtor Education?
In order to be discharged from Chapter 7 or Chapter 13 bankruptcy, you must complete a Pre-Discharge Debtor Education course. The purpose of this bankruptcy course is to help you remain financially secure and use credit wisely so you don’t end up in bankruptcy again.
The course teaches:
- Preparing a budget
- Money management
- Consumer protection laws and agencies
- Dealing with an unexpected financial crisis
- Setting and reaching financial goals
- Saving money
- Cutting expenses
Bankruptcy Abuse Prevention and Consumer Protection Act of 2005
This act was signed into law on April 20, 2005, and includes checks and balances to ensure that consumers are equipped to make informed decisions when it comes to filing bankruptcy. It includes the requirement that all Chapter 7 or 13 bankruptcy petitioners complete approved credit counseling and provide to the court a certificate of completion from a U.S. Trustee-approved, nonprofit credit counseling agency. The law also requires all consumers who file for bankruptcy to successfully complete two bankruptcy courses prior to having debts discharged.
Pre-File Credit Counseling
With Pre-file Credit Counseling, you’ll start online, then receive a personal counseling session by telephone to discuss the details of your current financial situation with a Certified Financial Counselor. Your counselor will help you build an accurate picture of your current finances, then give specific advice on actions you can take to improve it. You’ll also discuss short- and long-term financial goals and determine if there are any alternatives to bankruptcy. The counselor will explain consequences of bankruptcy and actions you can take to get back on sound footing after a bankruptcy.
You can complete the online portion of the course from the convenience of your home computer 24 hours a day, seven days a week. Counseling services are available in English and Spanish.