Bankruptcy Credit Counseling: What to Expect

October 21, 2011 by  Filed under: Bankruptcy 

If you’ve had to declare bankruptcy since 2005, then you already know that you’ll need to enroll in credit counseling before the bankruptcy courts can discharge your debts. While this may seem like a major hassle – not to mention an intimidating experience – the truth is that credit counseling can give you the solid foundation you need to start feeling better about your new financial path.

So what can you expect from bankruptcy credit counseling? Here’s a brief rundown:

1. First, you and a court-approved credit counselor will take a look at your personal finances and how you can avoid a bankruptcy in the future. This means you’ll learn basic financial skills, including living by a reasonable budget, spending smarter, using your credit wisely, and how to pay down debts responsibly and without straining your bank account. Again, this might seem like a hassle to go through, but it will provide you with the tools you need to make the most of your fresh new start.

2. Next, you’ll be required to take a money management course, which helps you to learn more about the ins and outs of living within your budget. This won’t just teach you the basics of saving, but it will also teach you how to resist the temptation of using your credit cards or leaving your savings account empty.

3. Finally, you’ll have to take a test at the end of your credit counseling session to confirm that you’ve successfully completed the course. This means you’ll be tested on everything you’ve learned, so make sure that you take your newfound financial skills to heart, as the biggest test will be dealing with your clean financial slate.

A credit counseling class should be approved by your local bankruptcy courts, so be sure that you’re enrolling in a federally-approved class. Your bankruptcy attorney can provide you with local credit counseling classes, or you can look online at

Credit counseling classes should cost no more than $50; should you encounter a so-called class that charges more than that, you should immediately report them to the Federal Trade Commission, as these classes are illegal.

Finally, don’t be intimated by the credit counseling experience. You might think that your counselors will berate and lecture you for filing for bankruptcy, but they’re actually there to help you. Besides, as a majority of bankruptcies are caused by major financial mishaps such as medical bills, divorce and job loss, it doesn’t make sense for credit counselors to approach their students with a heavy hand.

Ultimately, credit counseling classes are designed to give you the tools and resources you need to make sure you never end up in a bankruptcy court again. Take your bankruptcy credit counseling to heart, and use the skills you learn to avoid the debt pit again.

Reed Allmand, sponsoring attorney for, is constantly looking for ways to provide the best financial information for his clients. Whether you are considering filing for bankruptcy, or are currently going through a Chapter 7 or Chapter 13, visit for up to date news and information you need to know.

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