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Bankruptcy requires counseling and education

You and/or your business probably didn't easily come to the conclusion that filing for bankruptcy was the best option. It can take a significant amount of time to run numbers and soul search before concluding that, yes, bankruptcy is the best step.

Before taking that official debt relief step, the law requires those filing for various types of bankruptcies to think even further. Before bankruptcy papers can be filed, parties seeking Chapter 7, 13 or 11 bankruptcy must go through credit counseling.

Credit counseling is not as intensive as you might fear. Generally, the counseling is just one session that takes on average about one hour, and you can go through the session in-person, over the phone or online. First, make sure that the counseling provider is an approved agency.

Efficiency is a big priority in most of our lives. Be aware, however, that efficiency is not necessarily a priority in your bankruptcy filing process. Know that credit counseling and debtor education are not the same things. They do not occur during a singular session or at the same time in the bankruptcy process. Debtor education takes place later, after papers have been filed by you and your attorney.

Also related to the efficiency warning, your credit counseling agency should not act as your bankruptcy adviser. Your lawyer is the person who should and will properly advise you regarding your debt relief options. Do not expect or necessarily trust any specific bankruptcy advice that a credit counselor gives you. Look to your attorney for more valid, actionable guidance.

Have questions about the next required step in your bankruptcy process? Don't hesitate to reach out to a bankruptcy lawyer as soon as possible. The sequence of steps in the process is important to the overall outcome. 

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