Do I Have to Get Credit Counseling Before Filing for Bankruptcy?

credit report documents

If you are in a dire financial situation, you may want to file for bankruptcy as immediately as possible. Though, there are some pre-bankruptcy requirements that you must fulfill, one of them being attending credit counseling. Follow along to find out why you need to attend credit counseling and how a proficient Rockland County bankruptcy attorney at The Law Offices of Allen A. Kolber, Esq. P.C. can guide you through this process.

Do I need to attend credit counseling before filing for bankruptcy?

The short answer is, yes, you will need to attend credit counseling before filing for bankruptcy. This is regardless of whether you are interested in filing for Chapter 7 bankruptcy or Chapter 13 bankruptcy.

More specifically, you must provide proof that you received such counseling from an agency approved by the United States Trustee’s office. Pieces of proof may be a certificate of completion, your bankruptcy paperwork, and a copy of the repayment plan you worked on with the agency, among other relevant pieces of documentation.

Notably, you must attend this counseling within 180 days of filling out and submitting your official bankruptcy forms, which disclose all aspects of your financial situation. And afterward, you must pay a filing fee.

What is the purpose of this counseling?

You may view credit counseling as an additional barrier that prolongs your bankruptcy proceedings. However, you are required to take this step for a reason. That is, this counseling allows you to determine whether you need to file for bankruptcy in the first place, or if you can reach a resolution with an informal method. This is because the agency will look at your income against your debts, and go off on this to prepare a budget and repayment plan.

Importantly, while you may be required to attend credit counseling, you are not necessarily required to abide by the repayment plan that the agency proposes. But regardless, you will have to present this suggested repayment plan to the bankruptcy court. Something that you should be aware of is that, if the bankruptcy court determines that the agency’s suggested repayment plan is extremely feasible to complete, then they may begin questioning your Chapter 7 bankruptcy filing. With this, they may conclude that you are well-suited to repay all of your debts and that you should instead file for Chapter 13 bankruptcy.

You may have to make an argument with the bankruptcy court as to why you should not have to repay all your debts, why the suggested repayment plan is not well-suited for you, or otherwise. Without further ado, you must retain the services of a talented Rockland County bankruptcy attorney immediately. We can assure you that we are passionate about your case, so contact us today.