There are two courses that each debtor must complete in order to receive a discharge in Chapter 7 and Chapter 13 bankruptcy cases. The first course is a credit counseling course. This course must be completed before the bankruptcy case is filed. If a case is filed before the date on the certificate of completion issued after completion of the course then the court will automatically dismiss the case. The purpose of the credit counseling course is to provide the debtor an opportunity to review their financial situation and determine whether or not bankruptcy is the best option.
The second course is a financial management course. It must be completed after the bankruptcy case is filed but before the 45th day following the 341 meeting of creditors. However, there is no penalty if the debtor misses the deadline to complete the course, so long as the course is completed before the debtor’s bankruptcy case is closed. If the case is closed before the debtor completes the financial management course then they will not receive a discharge, which means that the debtor continues to be liable for the debts listed in the bankruptcy schedules. The debtor can reopen the case in order to file the certificate of completion and receive a discharge, but there is a court filing fee for reopening a bankruptcy case and usually additional attorney’s fees.
These courses are offered by nonprofit agencies that have bankruptcy courses approved by the Office of the United States Trustee. Most agencies will offer these cases online and over the telephone. Prices range from approximately $15.00 to $50.00 per course. The first course takes approximately an hour while the second course takes two hours. Certificates of completion list the judicial district in which the case is to be filed, so it is important to ensure that the nonprofit agency can issue a certificate in the district in which the debtor wishes to file.