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The Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005 added a requirement for all personal bankruptcy filings. It states that the filer must complete a pre-bankruptcy counseling session within 180 days prior to the filing date. This applies to Chapter 7, Chapter 11 and Chapter 13 filings.
It’s important to note that pre-bankruptcy credit counseling and post-filing debtor education are not the same. Both are requirements when you file for personal bankruptcy, regardless of the Chapter.
The debtor education requirement must be completed after you’ve filed, but prior to final discharge of your debts. The education class typically lasts a few hours; there is typically a fee between $50 and $100. As with pre-bankruptcy counseling, the session fee may be waived if you indicate in advance that you can’t afford to pay it. Once you complete the education class, you receive another certificate that’s separate from the pre-bankruptcy counseling certificate. This clears the way for final discharge.
Not all credit counseling agencies are approved by the U.S. Trustee Program under the Department of Justice to provide the certification for pre-bankruptcy credit counseling. You must take the extra step of check the Trustee Program’s website to make sure providers for both pre-bankruptcy credit counseling and post-filing debtor education are approved in the judicial district where you wish to file.
Article last modified on August 7, 2019. Published by Debt.com, LLC