Most individual debtors must complete two courses in a bankruptcy case, and both are easy to overlook in the rush to prepare a petition. One must be done before filing. The other comes after, and missing it can mean the case closes without a discharge. A good bankruptcy office tracks both from the first day.
This is a general overview. Exceptions, deadlines and local procedures vary, and the attorney confirms what applies to each client.
Course one: credit counseling (before filing)
The Bankruptcy Code generally requires an individual debtor to receive a credit counseling briefing from an approved agency within a set period before filing. The briefing reviews the debtor's budget and options for dealing with debt. After completing it, the agency issues a certificate.
- Use an approved provider. The U.S. Trustee Program publishes lists of approved credit counseling agencies, and the course must come from one of them. A course from a provider that is not approved does not satisfy the requirement.
- Mind the timing. The course has to be completed before filing and within the permitted window, so a client who took one long ago may need another.
- Get the certificate. It is normally filed with the petition, and the petition asks about it. Do not file until you have it, unless the attorney has identified a recognized exception.
- Exceptions are narrow. There are limited circumstances, such as urgent filings or certain disabilities or military service, in which the requirement may be waived or delayed. Whether one applies is a legal decision, and a court may need to agree.
A missing or invalid certificate is a classic cause of a dismissed case, which is why it appears on our petition review checklist and in the list of common petition errors.
Course two: debtor education (after filing)
The second course, often called the financial management or debtor education course, is taken after filing. It is generally a condition of receiving a discharge, and again it comes from an approved provider and produces a certificate that must be filed with the court.
- The deadlines differ by chapter. In a Chapter 7 case, the deadline is measured from the date first set for the meeting of creditors. In a Chapter 13 case, it is tied to completion of plan payments. The attorney or the court rules give the exact date.
- Some providers file the certificate for you, and some give it to the debtor to pass on. Find out which applies, because a certificate nobody files is the same as a course not taken.
- Joint filers each need one, unless an exception applies.
If the certificate is not filed on time, the case can close without a discharge and the debtor may have to reopen it, usually at additional cost. See what happens after a petition is filed for the other post-filing milestones.
A simple tracking routine
- At intake: tell the client about the first course, with the list of approved providers, and ask them to send the certificate as soon as they have it.
- Before filing: confirm the certificate is in the file, is from an approved provider and is within the window.
- On filing day: add the debtor education deadline to the calendar, with a reminder well ahead of the date.
- After the meeting of creditors: remind the client of the second course and ask for the certificate.
- Before closing: confirm the certificate has been filed, and note it in the file.
Where it fits in the workflow
The first course belongs in the intake and collection stage of the process, as in our Chapter 7 workflow, and the documents list is a good place to remind clients about it.
Role reminder
Telling a client which provider to choose in a way that amounts to advice, or whether they qualify for an exception, is the attorney's job. An assistant can share the official list, remind clients of deadlines and keep the paperwork organized. That kind of reliability is what attorneys look for. To be found by attorneys who value it, join NAVBA, or hire a virtual bankruptcy assistant to keep the tracking on your side.
This article is general information about bankruptcy practice, not legal advice. Local rules, trustee preferences and state law vary, so confirm current requirements for your jurisdiction.
