Bankruptcy and financial problems can be scary. How and why someone finds themselves in this position are often the asked questions. Fortunately the days of debtor’s prisons are long over. But many people fear bankruptcy for one simple reason-they do not understand or know the facts.
While there is much to know about the bankruptcy process, potential bankruptcy filers should be particularly aware of two amendments to the Bankruptcy Code enacted in 2005 which place new duties on individual debtors. In addition to filing schedules and a statement of financial affairs, the 2005 Amendments requires every debtor, who is an individual, to file, at the time that the case is commenced, a certificate issued by an approved budget and credit counseling agency stating the services rendered to the debtor. In addition, a copy of a proposed debt repayment plan prepared by the credit counseling agency for the debtor must also be filed at the same time as the petition, if one has been prepared. An individual cannot be a debtor under Chapters 7, 11, or 13 unless they file this certificate.
A person is temporarily exempt from this requirement if: (1) he or she lives in a district where the Office of the U.S. Trustee has determined that the there are no credit counseling agency in the district that are qualified to deliver services to debtors in that district; or (2) the debtor files a certification with the court showing that exigent circumstances exist which merit a waiver of such requirements, or the debtor requested services from the credit counseling agency, but was unable to obtain the services for a period of seven days from the time they were requested. In the event that such an exemption is granted by the court, the debtor must submit proof of the required credit counseling by a credit counseling agency, within 30 days of the filing of the petition. The court can further extend this exemption for an additional 15 days.
In order to get a Chapter 7 or 13 discharge, the debtor must also complete an approved personal financial management course, in addition to the debt counseling requirement discussed above. It is designed to give debtors some personal financial management tools in order to avoid financial problems after the discharge is granted. A certificate of completion of this course must be filed in a Chapter 7 case within 45 days following the first date set for the meeting of creditors and in a Chapter 13 case no later than the date when the last payment was made by the debtor as required by the plan.
Advice From A Debit Relief Attorney
Making the decision to file for bankruptcy is a difficult one and seeking the advice of an experienced bankruptcy attorney is important to educate you so that you understand the process and eliminate the burdens of all the legalities involved. Contact us today for a free initial consultation at (303) 438-8477.