Credit counseling requirements for Florida bankruptcy filers

On behalf of Bankruptcy Law Firm of Clare Casas on Monday, September 15, 2014.

Florida residents filing for Chapter 7 bankruptcy must receive credit counseling from an approved organization within 180 days of the filing date, or their application may be denied. This is meant to ensure that individuals are aware of their available options. They must also complete a debtor education course before discharging their debts through bankruptcy. Credit counseling may not be undertaken concurrently with debtor education. While credit counseling occurs prior to filing for bankruptcy, debtor education occurs during the bankruptcy process.

Credit counseling generally consists of a personal financial evaluation, education on alternatives to bankruptcy and assistance in developing a personal budget plan. Counseling sessions typically last at most 90 minutes and may be done over the phone, in person or online. Approved counseling organizations are required to provide free services for those who can't afford to pay via a fee waiver. Individuals should ask for this waiver before the session begins.

Debtor education consists of a similar process, though it is designed to help filers get back on their feet following the discharge of their debts. It involves assistance in developing a budget, general money management education and tips for how to use credit wisely. Debtor education typically takes about two hours, and the fee may be waived in cases of financial duress. A waiver must be requested prior to the education session. Proof of completion of both is necessary for the Chapter 7 case.

Credit counseling is an important part of handling one's finances in the steps leading to bankruptcy. A bankruptcy lawyer may be able to help with finding a credit counselor as well as providing guidance and representation throughout the entire process.

Source: The Federal Trade Commission , "Filing for Bankruptcy: What to Know", September 09, 2014