Bankruptcy And Financial Education Classes

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If you are considering filing for chapter 7 bankruptcy, you must complete two educational programs. One program must be complete before you file, the other must be completed prior to your discharge. Read on for more information about these requirements so that you'll be prepared for filing for chapter 7 bankruptcy.

In 2005, President Bush signed the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. The BAPCPA sought to, among other things, make consumers more accountable for their actions leading to bankruptcy filing. This act required bankruptcy filers to take classes in credit counseling and in personal finance.

Credit Counseling Class

• The credit counseling class must be taken prior to filing for bankruptcy. You can take it in person, online, or over the phone. The certificate you receive for completing this class must be filed with your bankruptcy petition when you file with the court. The cost of this class is based on a sliding scale for income, with the class being free of charge for those under a certain income.
• This class is basically a confirmation that you are without financial options and must file for bankruptcy. Part of the class is a budget that must be completed to determine your ability to pay off your debts without having to file for bankruptcy. The credit counseling agency reviews your budget to confirm that, indeed, you are not able to pay your debts.
• If, however, the agency feels that you may be able to pay off your debts, they will prepare a report that gets filed with your bankruptcy petition. The bankruptcy court could address the report at your hearing, so be prepared to convince the bankruptcy trustee that the agency's recommendations won't work for your situation.

Personal Finance Class

• This class, available online, through the mail or in person, must take at least two hours to complete and the cost is based on a sliding scale. This class must be taken after you have filed for bankruptcy and you must file your certificate with the court no later than 45 days after your creditors meeting.
• The Justice Department oversees the management of this class and provides an online search for approved agencies to administer the class. This class presents information on preparing a budget, making good choices when securing credit and planning for emergencies.

Keep in mind that there are strict federal guidelines for these classes and failing to follow the rules will put your entire bankruptcy case in jeopardy. Your bankruptcy attorney will be able to assist you in choosing the classes and getting the certificates filed in a timely manner. For more information about bankruptcy or to find an attorney, contact a professional like Sever Law Office.

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24 June 2015