California Bankruptcy Lawyer Blog

San Jose Bankruptcy Attorney Discusses Pre-Bankruptcy Credit Counseling

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 now requires people who plan to file for bankruptcy protection to get credit counseling from a government approved organization within 180 days before they file. They also must complete a debtor education course to have their debts assigned and discharged.

As a rule, pre-bankruptcy credit counseling and pre-discharge debtor education may not be provided at the same time. Credit counseling must take place before you file for bankruptcy; debtor education must take place after you file.

A pre-bankruptcy counseling session with an approved credit counseling organization should include an evaluation of your personal financial situation, alternatives to bankruptcy, and a personal budget plan. A typical counseling session should last about 60 to 90 minutes, and can take place in person, on the phone, or online. The counseling organization is required to provide the counseling free of charge for those consumers who cannot afford to pay. If you cannot afford to pay a fee for credit counseling, you should request a fee waiver from the counseling organization before the session begins. Otherwise, you may be charged a fee for counseling which will generally be about $50, depending on where you live, the types of services you receive, and other factors.

Once you have completed the required counseling, you must get a certificate as proof. Check the U.S. Trustee’s website to be sure that you receive the certificate from a counseling organization that is approved in the judicial district where you are filing bankruptcy.

If you have a question regarding Bankruptcy please contact Sagaria Law at 1-800-941-6730 for a free consultation or visit us at www.sagarialaw.com. Our team of Bankruptcy Attorneys can assist you with all aspects of your case. We have attorneys in San Mateo, Monterey, Fremont, Salinas, Sacramento and San Jose.