In both Chapter 7 and Chapter 13 bankruptcy, you (and your spouse if you file jointly) must take a personal financial management course from an agency approved by the court before you receive your final discharge. This course is known by several names, including predischarge counseling and budget counseling.
Read on to learn about the financial management course requirement.
Pre-Bankruptcy Credit Counseling v. Predischarge Counseling
The personal financial management course requirement is different from the credit counseling that you must receive prior to filing for bankruptcy. (To learn about that requirement, see The Pre-Bankruptcy Credit Counseling Requirement.) You must take the financial management course after you’ve filed for bankruptcy but before you get a discharge.
Approved Agencies and Financial Management Courses
You must take the court from an agency approved by the Office of the U.S. Trustee. Approved courses must last a minimum of two hours and cover certain required curriculum.
Unlike the agencies approved to provide pre-bankruptcy credit counseling, the agencies providing personal financial management courses don’t have to be nonprofits. However, the agencies must allow you to pay a sliding scale fee if you can’t afford to pay the full price. You can take the course in person, online, or through the mail.
You can find approved agencies in your area by visiting the U.S. Trustee’s website at www.justice.gov/ust. Click on “Consumer Information,” and then “Credit Counseling & Debtor Education.”
Filing the Certificate
After you take the course, you must file Official Form 23 with the court, which certifies that you have taken the course. You must also file a certificate of completion from the debtor education agency.
When You Must Get the Counseling
In Chapter 7 bankruptcy, you must file Form 23 and the certificate no later than 45 days after the date on which your meeting of creditors was first scheduled. Don’t miss the deadline. If you do, the court might close your case. If that happens, you’ll have to reopen your case (which costs money).
In Chapter 13 bankruptcy, you must file Form 23 and the certificate no later than the date on which you make your last plan payment. You can take the course early on in your case, however, and some attorneys recommend this because the course provides information that may help you budget and successfully complete your plan.
To learn about other requirements and procedures in bankruptcy, see our Bankruptcy Filing & Procedures area.