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Pop quiz time.  What’s the biggest waste of time and money in the bankruptcy law?
It makes no sense on any level. In order to file for bankruptcy you need to go through a mandatory credit counseling certification process.
Note that I didn’t say you need to go through credit counseling, that “take all your credit card debts and combine them into a single monthly payment” process you know from late-night television and newspaper ads.
Nor did I say you needed to review your financial situation with a certified financial planner to see if there’s another viable option for getting out of debt.
You’ve made the decision to file for bankruptcy, met with a lawyer, sized up your options … and you still have to do this credit counseling certification. And before we begin, let me be clear about one thing – the credit counseling certification process in bankruptcy has absolutely nothing to do with the very valid goal of financial literacy. It is a necessary evil, and nothing more.
Depending on which company my clients use, each year collectively they waste tens of thousands of dollars.  They get nothing out of it except a piece of paper that allows them to file for bankruptcy.  None complete the process any smarter or better informed.
Why Credit Counseling Is Required Before You File For Bankruptcy
Under the Section 109(h) of the U.S. Bankruptcy Code, you are required to obtain a credit counseling certification from a government-approved organization within 180 days before you file for bankruptcy. There are, however, a few limits exceptions. They are:

1. if you live in a district for which the United States trustee (or the bankruptcy administrator, if any) determines that the approved nonprofit budget and credit counseling agencies for such district are not reasonably able to provide adequate services.
2. if you submit to the court a certification that: (a) describes exigent circumstances that merit a waiver of the credit counseling requirement; (b) that you requested credit counseling services from an approved nonprofit budget and credit counseling agency, but were unable to obtain the services during the 7-day period beginning on the date on which you made that request; and (c) is satisfactory to the court.
3. if the court determines, after notice and hearing, that you are unable to complete the credit counseling certification because of incapacity, disability, or active military duty in a military combat zone.

You may have a shot at #3, but the first two exemption classifications are unheard-of.  Don’t fool yourself.
Finding An Approved Credit Counseling Company
The Department of Justice’s U.S. Trustee Program has a massive list of approved credit counseling certification providers.  Most lawyers have one or two companies they like to use, either due to lowest price, service, or a combination of both.  I’ve used many of them, and find that the only real difference is in price and languages spoken.  For example, if I’ve got a client who speaks Tagalog then I’m going to look for a company that offers services in this language.
What To Expect During The Session
The credit counseling session usually lasts between 20-30 minutes.  Some places take longer, other shorter.  This is a session that doesn’t impart any particular knowledge or wisdom, though; I went through it when the requirement came into law in 2005, and thought it was a glorious waste of time.  Therefore, I don’t think there’s anything wrong with a client doing the session while surfing the Internet or flipping through a magazine.
I know, it’s heresy.  But it’s my opinion.  So there you have it.
Filing The Certification
Once you’ve gone through the session (usually by phone or online – if you’ve got a choice, go with the “online only” option so you can take it without turning down the television), you’ll get a certificate of credit counseling completion.  To protect against fraud, the certificates are produced through a central automated system and are numbered.
I usually get it for my clients because it’s easier for me to compile the documents rather than making my client jump through more hoops.  You need to file it with your petition, and our computer system will handle that so nothing gets lost in the shuffle.
Don’t Lose Sleep Over This
The credit counseling process is nothing like you’ve gone through.  It’s the bankruptcy equivalent of a diploma mill, churning out certificates to all comers.  Nobody’s going to pass judgment on you, and nobody’s going to tell you to do something you don’t want to do.
Just go with the flow.  Someday Congress will take away this silly requirement, but until then we’re going to have to live with it.
Image credit: Yukon White Light
How To File Bankruptcy: Credit Counseling was originally published on Consumer Help Central. If you're seeing this message on another site, it has been stolen and is being used without permission. That's illegal, a violation of copyright, and just plain awful.

Bringing you the most up-to-date news, tips and blogs throughout the web. Here’s your Bankruptcy Update for May 23, 2013 Atari seeking $22.2 million in bankruptcy auction Busy New York Bankruptcy Court Faces Budget Crunch Bankruptcy attorney Randolph Goldberg sentenced to prison

If you find yourself in over your head after filing for bankruptcy, there are options.
Life has a funny way of going left when you want it to go right.
You file for bankruptcy, go through the process, and come out the other end.
Though you swear you’ll never be in that situation again, sometimes the unexpected happens.
An unreimbursed medical expense, job loss, or other money crunch puts you in the financial hole again.
Can you file for bankruptcy again?
For A Second Bankruptcy, Consider Your Goal First
Depending on what you need to accomplish, you may not even care about getting a discharge at the end of a bankruptcy case.
For example, let’s say you’ve run up against some big tax debts and just need some time to pay them out.
Maybe you’ve got a past due mortgage and are looking for a way to catch up on the arrears.
In other words, you need to file for bankruptcy but don’t much need the discharge part of the equation.
For situations that can be helped with a little time on your side, filing a Chapter 13 bankruptcy may be the best option. You can file a Chapter 13 bankruptcy at any time after a Chapter 7 discharge, but if it’s within 4 years of your Chapter 7 then you’ll need to propose a repayment of your entire debt.
If You Need A Discharge Of Your New Debts
There are limits to your ability to get a discharge of your debts in either a Chapter 7 or a Chapter 13 bankruptcy if you’ve filed before.
Different rules apply based upon the type of bankruptcy case you filed first.  In a nutshell, the time frames between discharge eligibility:

• If you filed a Chapter 7 bankruptcy less than 8 years ago, you cannot get a discharge in another Chapter 7
• If you filed a Chapter 7 bankruptcy less than 4 years ago, you cannot get a discharge in another Chapter 13
• If you filed a Chapter 13 bankruptcy less than 2 years ago, you cannot get a discharge at the end of another Chapter 13;
• If you filed a Chapter 13 bankruptcy less than 6 years ago and repaid less than 70% of your debts, you cannot get a discharge in a new Chapter 7.

If You Need To Wait
Remember that your only option is not to file for bankruptcy.
You can try to work out payment options with your creditors.
You can defend against a lawsuit or foreclosure with an eye towards settling the matters.
You can stop the debt collection calls using the Fair Debt Collection Practices Act.
These may not be perfect solutions, but if you can’t file for bankruptcy yet then at least you can get some of the power back in your hands.
Let the clock run down, wait until a bankruptcy will accomplish your goals, and go from there.
Image credit:  JohnSeb
How To File Bankruptcy Again When You’re Back In Debt was originally published on Consumer Help Central. If you're seeing this message on another site, it has been stolen and is being used without permission. That's illegal, a violation of copyright, and just plain awful.

The class of 2013 has just replaced the class of 2012 for the title of the most indebted class in American history. With the way student loan burdens are increasing, the class of 2013 will inevitably lose their title to next year’s senior class.
In 2013, graduating seniors left college with an average debt load of $30,000. That’s nearly double the amount that students graduated with 20 years ago. A recent study reveals that if you factor in credit card debt and money borrowed from family during school, students are really graduating with an average of over $35,000.
A separate study released Thursday by Fidelity Investments painted a bleaker picture. The class of 2013 carried an average of $35,200, Fidelty’s study found, which includes credit card debt and money owed to family members. Half of all graduates with debt said in the survey that they were surprised at how much they accumulated.
Given that student loan collections bureaus are among the most aggressive debt collectors out there, graduating seniors are in for a rude shock once they leave school and are unable to find jobs to pay the monthly minimum payments.
Given how difficult these loans are to discharge in Chapter 7 Bankruptcy, student loan lenders must be ecstatic to find themselves in an almost risk free business. While these lenders may be happy, the overall picture young Washington and Oregon local graduates is obviously pretty bleak. Beyond our graduates and their families, the student loan problem has repercussions for all of us. First, the student loan dollars are almost all paid to the federal government or to out of state lenders so repayment dollars leave the Pacific Northwest. Second, experts believe that the student loan expansion will significantly burden the housing market. Young people will be so caught up in trying to fulfill their student loan obligations that they will be unable to participate in the housing market. A weak housing market, as anyone who has lived through the last decade will tell you, is the last thing we need.
Contact our offices immediately if you are struggling to meet your student loan burden and the creditors are calling. Though it is extremely difficult to discharge these loans, except under certain very narrow circumstances, there is relief worth discussing under Chapter 13 of the Bankruptcy Code. I will look forward to hearing from you.
The original post is titled Crushing Burden of Student Loans in Oregon and Washington , and it came from Oregon Bankruptcy Lawyer | Portland, Salem, and Vancouver, Wa .