Credit Counseling

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 made it mandatory for certain filers to take an accredited counseling course within 180 days from the date they file for bankruptcy protection. Certain filers must also take an accredited instructional course in personal finance before the completion of bankruptcy. Both of these courses collectively are known as credit counseling.

At the completion of each course the debtor must submit their certifications for both courses to the bankruptcy court, within the specified time frame, to be able to proceed through the bankruptcy process.

Credit counseling courses must be certified by the Department of Justice's U.S. Trustee Program. A filing debtor can normally find out which courses are acceptable to the bankruptcy court by either contacting the U.S. Trustee Program website online or the U.S. Trustee office which has jurisdiction over the debtor's district bankruptcy court.

The goal of credit counseling prior to bankruptcy is to allow the debtor to understand all the options they have to eliminate their debts. Bankruptcy is a serious financial decision and should not be made without considering other alternatives. Filing bankruptcy will lower your credit score, remain on your credit report 7 to 10 years and make it difficult to get credit.