The Bankruptcy Code was amended in 2005 to require that every debtor filing for bankruptcy take a credit counseling course with an approved provider. The course can be taken in person, over the phone or on the internet, within the six months prior to the filing of the case. The cost of this course is under $50. The provider will supply a certificate of credit counseling which must be filed with the debtor’s bankruptcy petition. If the petition is filed without the certificate, the court may dismiss the bankruptcy case.
The course providers are designated by the US Trustee for the district in which the case is to be filed, and are listed on the court website, and are also available from your bankruptcy attorney.
The debtor is also obligated to take a financial management course in order to receive a bankruptcy discharge. This course is typically taken after the petition is filed. Again, an approved provider must be used, and the course can be taken in person, over the phone or on the internet, with a similar cost. The financial management certificate must be filed with the court by the deadline set forth in the initial case notice. If the bankruptcy case is closed without a discharge being issued, due to the failure to file the financial management certificate, the debtor must file a motion to reopen the bankruptcy and pay a filing fee ranging from $235 to $260, and then take the financial management course and file the certificate. Thus, the debtor may incur legal fees for the motion as well as the filing fee. It is therefore imperative that the debtor take the financial management course on a timely basis.
Mr. Whelan is available by phone or e mail to answer your bankruptcy law questions.