If you have come to the realization that your debt is too overwhelming for you to manage on your own, you might consider filing for bankruptcy. However, before you can begin the process of filing for bankruptcy, you will have to go through a process call or texted pre-bankruptcy counseling. This is a mandatory process that will help you determine if bankruptcy is truly your best option, and if you are eligible to file. If bankruptcy seems like your next step, be sure to understand the pre-bankruptcy counseling process.
Before you do anything regarding your outstanding debt, you first need to attend mandatory pre-bankruptcy counseling. This meeting will determine if you are truly qualified to file for bankruptcy. You and a counselor will look at all of your debts and figure out if there is any way to handle your debt without filing for bankruptcy. Bankruptcy should be used as a last resort in many cases, so counselors will work with you to make sure that bankruptcy is right for you before you begin the filing process. The agency that you choose to counsel you on your debts must be on a certified list that is approved by the Office of the U.S. Trustees. This list can be found here.
No matter what your income and debt is, everyone wishing to file for bankruptcy must go through this process. The counselor will most likely come up with some sort of repayment plan if you truly are not suitable to file for bankruptcy. He or she will then also create a budget based on your income and expenses for you and your family to follow. This can help you plan for the future.
For the most part, counseling fees are not high. Depending on circumstances, the fee will be under $50. Although, if your income level is so low and debt so high that you cannot afford that at all, the counseling agency is required to provide their services free or at reduced rates if need be. One you counseling is over with, you must receive a certificate as proof that you have completed pre-bankruptcy counseling and then you may begin the process of filing for bankruptcy. The certificate is included in the initial service fee charged at the beginning of the consultation.
Getting help with your debt requires help. This mandatory pre-bankruptcy counseling enables you to evaluate all of your finances and come up with a reasonable solution to the problem, whether that means filing for bankruptcy or establishing a payment plan. If you have any questions regarding filing for bankruptcy or if you wish to contact my office, please click here.