Before you file for bankruptcy, complete a credit counseling session with an agency the Justice Department approves, no more than 180 days ahead. After you file, finish a second course in debtor education. Skip either one and the court can dismiss your case or deny the discharge, and you keep the debts.
Both courses are short and cheap, so the part to get right is timing. Counseling taken 181 days before your filing date doesn’t count, and neither does a debtor education course taken before you file.
Counseling comes from an agency approved by the Justice Department’s U.S. Trustee Program. A counselor goes through your budget and your options for the debt, usually in about an hour by phone or online, then issues a certificate of completion.
If you’re filing jointly, each spouse takes both courses and gets a separate certificate. Take the steps in this order:
- Open the Trustee Program’s list of approved agencies, sorted by state and judicial district, and pick one listed for the district where you’ll file.
- Ask about the fee before you start. Agencies usually charge $10 to $50, and if your household income falls under 150% of the federal poverty guidelines, you’re presumed eligible for a waiver or a reduced fee.
- File the counseling certificate with your petition.
- After you file, take debtor education from a provider on the Trustee Program’s separate list of approved providers. The course runs at least two hours, and the same fee rules apply.
- Ask whether the provider files your certificate with the court. If not, file it within 60 days after the original date of your meeting of creditors in Chapter 7, or by your last payment under a Chapter 13 repayment plan.
Book the counseling once you expect to file within 180 days, and for anything beyond the simplest Chapter 7, have a bankruptcy lawyer file the case.
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