Credit counseling briefing
Under the new law, consumers who want to file for bankruptcy must
complete a credit counseling briefing, designed to inform them of
their options in dealing with their debts, six months prior to filing.
The course must be at least 90 minutes long and can't cost more than
$50. Accredited agencies can't turn anyone away based on their ability
to pay.
The briefing can be provided through one-on-one, in-person counseling;
group classes or over the phone or Internet. The U.S. Trustee Program
of the Department of Justice, which administers various aspects of the
new bankruptcy law, must approve the curriculum.
Topics covered in the briefing include examining the underlying causes
of a consumers' financial problems; a look at their budget, in terms
of their income and expenses; helping them understand the
debt-to-income ratio; providing guidance as to whether a
debt-management plan will help the consumer; and the consequences of
filing for bankruptcy and other alternatives to bankruptcy, according
to Gail Cunningham, vice president of business relations with Consumer
Credit Counseling Service of Greater Dallas, an agency that has
applied to provide these classes.
Because of the fee-waiver requirement, and the fact that most people
considering bankruptcy don't have a lot of money to spare, a good
number of these briefings will take the form of online interactive
classes, says Howard Dvorkin, founder of Consolidated Credit
Counseling Services in Fort Lauderdale, Fla.
If a consumer works with a credit counseling agency's counselor who
believes they could benefit from a debt management plan and draws one
up, that plan must be included with the consumers' bankruptcy
petition, even if the consumer doesn't believe he has the ability to
meet the obligations of such a plan.
Under the new law, consumers who want to file for bankruptcy must
complete a credit counseling briefing, designed to inform them of
their options in dealing with their debts, six months prior to filing.
The course must be at least 90 minutes long and can't cost more than
$50. Accredited agencies can't turn anyone away based on their ability
to pay.
The briefing can be provided through one-on-one, in-person counseling;
group classes or over the phone or Internet. The U.S. Trustee Program
of the Department of Justice, which administers various aspects of the
new bankruptcy law, must approve the curriculum.
Topics covered in the briefing include examining the underlying causes
of a consumers' financial problems; a look at their budget, in terms
of their income and expenses; helping them understand the
debt-to-income ratio; providing guidance as to whether a
debt-management plan will help the consumer; and the consequences of
filing for bankruptcy and other alternatives to bankruptcy, according
to Gail Cunningham, vice president of business relations with Consumer
Credit Counseling Service of Greater Dallas, an agency that has
applied to provide these classes.
Because of the fee-waiver requirement, and the fact that most people
considering bankruptcy don't have a lot of money to spare, a good
number of these briefings will take the form of online interactive
classes, says Howard Dvorkin, founder of Consolidated Credit
Counseling Services in Fort Lauderdale, Fla.
If a consumer works with a credit counseling agency's counselor who
believes they could benefit from a debt management plan and draws one
up, that plan must be included with the consumers' bankruptcy
petition, even if the consumer doesn't believe he has the ability to
meet the obligations of such a plan.