When you are preparing to file for bankruptcy, it’s important to determine whether or not this is the right option for you. It’s a big decision and a New City bankruptcy attorney would never rush you into it, but there are also other guardrails in place that ensure that someone is absolutely pursuing their best option when they file. One of those is the mandatory credit counseling program.
What is Credit Counseling?
Credit counseling is a course you take to see if it would be possible for you to rebuild your finances without going through the bankruptcy process. You would take this course before starting Chapter 7 or Chapter 13 bankruptcy. The course can help you develop a personal budget and teach you other things about managing money, but its main purpose is to see if a feasible payment plan can be made with your creditors.
If you can arrive at a plan that looks agreeable to you, then you do not need to go through bankruptcy. However, if you cannot seem to find a way to repay these debts without the broader restructuring that is possible with the bankruptcy process, then you will get a certificate that says you completed credit counseling along with the permission to move forward with bankruptcy.
Is Credit Counseling Mandatory?
Yes, you do have to go through a credit counseling class if you are considering bankruptcy. Sometimes exemptions are given out, but this is a rarity. The point of this course is to give you a better understanding of your options.
When Do I Have to Go to Credit Counseling?
You do have to go to credit counseling before you begin the bankruptcy paperwork. More specifically, you will attend the course within 180 days of your desired bankruptcy filing date.
Does It Matter If I Choose Chapter 7 or Chapter 13 Bankruptcy?
Both of these processes are quite different, but they have at least one thing in common. The credit counseling class is required whether you file for Chapter 7 or Chapter 13 bankruptcy. This is true even though the way your debts are handled in these types of bankruptcy and the requirements for each type of bankruptcy differ.
How Can a Bankruptcy Attorney Help Me?
If you do end up filing for bankruptcy, you’ll find that the process requires a lot of paperwork. You also want to make sure that you are making the most out of any possible exemptions and that nothing gets missed in the process. This is why we recommend hiring an attorney. We can focus on the paperwork while you focus on getting a fresh financial start.
Schedule Your Consultation
So if you are considering bankruptcy, do not try to tackle this complex process on your own. Contact the Lauterbach Law Firm and schedule a consultation. We can tell you more about your options, the bankruptcy requirements, and how one of our attorneys can be of assistance.