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Credit Counseling and Financial Management (Debtor Education)

You must complete two instructional courses to be entitled to a discharge in a Chapter 7 or Chapter 13 case – one before filing, and one after filing.

Credit Counseling Briefing.  The Bankruptcy Code requires that individual debtors who file for bankruptcy relief receive a credit counseling briefing within 180 days before the bankruptcy filing. The briefing may be in-person, over the phone, or on the Internet, and must be provided by a nonprofit budget and credit counseling agency approved by the United States Trustee. Click here for a list of approved agencies.  The counseling agencies charge a small fee for their services which may be waived on a case-by-case basis; consult with the counselor about the availability of a waiver.  A certificate of completion of the credit counseling briefing must be filed with your bankruptcy petition.

Your case may be dismissed if you do not file the required certification, and you will not receive a discharge of your debts.  In some cases, you may not be allowed to file another case for 180 days, or your protection under the Bankruptcy Code’s automatic stay from your creditors may be limited.

If you are incapacitated or disabled (as defined by the Bankruptcy Code), or are on active military duty in a military combat zone, the requirement for credit counseling can be waived.  LBF 100.3 must be used to file a motion for exemption when you file your petition.

Financial Management (Debtor Education).  After filing a bankruptcy case, you must also complete a financial management instructional course (debtor education) in order to receive a discharge.  Failure to complete the course and file proof of completion will result in your case being closed without a discharge.  Click here for a list of agencies approved to provide the financial management course.  As with the pre-bankruptcy counseling, there is a small fee for the course which may be waived on a case-by-case basis.  Consult with the agency about the availability of a waiver.