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Home  >  Articles  >  Pre-bankruptcy Credit Counseling

Pre-bankruptcy Credit Counseling

A new step was added to the bankruptcy process in 2005 when Congress enacted the requirement that all debtors filing for bankruptcy first complete mandatory credit counseling. This added requirement to a bankruptcy filing is intended to help debtors understand whether or not they truly need to undergo bankruptcy or would be better off seeking other options. It also provides helpful financial tips for better future management of money and assets. Before a debtor can seek much-needed financial assistance through bankruptcy, they must usually complete an accredited course.

At Hong Law, PLC, our experienced Cedar Rapids bankruptcy attorneys can help guide you through every step of the bankruptcy process, offering clear advice and assistance with issues, such as credit counseling and its impact on your bankruptcy case. To learn more about achieving debt relief through bankruptcy, call us today at (319) 294-5853.

Exceptions to the Credit Counseling Requirement

Even when it is clear that your debt to income ratio is far too poor for your debts to be settled in any manner other than bankruptcy, you must still fulfill the credit counseling requirement in order to proceed with Chapter 7 bankruptcy. Only in the following circumstances will this requirement be waived:

  • You have to file immediately to prevent wage garnishment or foreclosure and can convince the court of this need
  • You are forced to wait more than 5 days to obtain counseling after initially requesting it
  • You are on active military duty in a combat zone
  • You possess a physical or mental disability which prevents you from completing counseling

Barring any of these circumstances, the credit counseling agency will examine your finances and prepare a budget which will demonstrate your need for bankruptcy.

Contact Us

There are very few debt situations which cannot be managed through effective use of the bankruptcy system, and the Cedar Rapids bankruptcy lawyers at Hong Law, PLC, have the experience and resources to help guide and advise you through any bankruptcy situation. For a free consultation to discuss the details of your case, call us today at (319) 294-5853.



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Coralville, IA 52241
Phone: (319) 354-1804
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