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Preparation for bankruptcy includes credit counseling

There are projects that will keep you busy as you prepare for bankruptcy. One will involve pulling together documents that will be essential to the filing.

As you are organizing your paperwork, you will also need to obtain credit counseling.

Entering counseling

Before you can file for Chapter 7, 11, 12 or 13, you must submit to credit counseling. Under the United States Bankruptcy Code, you are required to contact a qualified bankruptcy counselor approved by the government, which thoughtfully provides a list from which to choose. You will work one-on-one with a counselor, and you can do this in person, but also by phone or even by Web chat.

Your contact will want information about your income and expenses, assets and liabilities. Among other subjects, there will be a discussion of your financial goals, and your counselor will likely recommend a workable spending plan. Upon satisfactory completion of the credit counseling program, you will receive a certificate of participation and you can then go forward with your plan to file for bankruptcy.

Providing documentation

You will need to provide proof that you have finished credit counseling. In addition to this documentation, your bankruptcy attorney will also need to see evidence of your debt. Some of the items you should present include your bills and any collection letters you may have received. Also important will be copies of pay stubs as well as your bank statements going back six months plus tax return copies for the past two years. If you own real property, you will need to produce copies of deeds, titles and mortgage information.

Preparing for the future

When you consult with your attorney, options will be discussed, and you will receive guidance on the type of filing that is best for your particular situation. The goal is to see you through the appropriate bankruptcy process and help you begin a new life on sound financial footing. Being well prepared with relevant information about your debts and proof of your participation in debt counseling will help your attorney and make the entire bankruptcy procedure go more smoothly than you anticipate.

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