What Really Happens When You File For Bankruptcy
Author: Carl Hampton

Having a hard time paying your bills? Do they seem like they
just keep adding up? A lot of people in this situation think
that filing for bankruptcy is the easy way out. In all reality,
bankruptcy should be your very last resort.  Most people do not
understand the long term effects of this course of action they
are also unaware that there is a very extensive process that
happens before and after you file for bankruptcy.

The Bankruptcy Abuse Prevention and Consumer Protection Act of
2005 states that people who plan to file for bankruptcy
protection are now required to receive counseling from an
agency that is government approved within a six month period
before filing.  After filing bankruptcy a debtors education
course must be completed.  The Department of Justice has a U.S
Trustee Program wherein only counselors and educators that
appear on the program's list can counsel you.  By law the U.S.
Trustees Program cannot operate in Alabama and North Carolina
because they have what are referred to as Bankruptcy
Administrators.

The credit counseling and debtor education might not take place
at the same time. But it is necessary to complete both for those
who are filing for bankruptcy. The counseling must take place
before filing, a certificate of credit counseling completion
must be attained when filing for bankruptcy. The debtor
education program normally takes place after the filing.

The counseling session consists of an evaluation of personal
financial situations, a discussion of alternatives to
bankruptcy, and a budget plan. The session should normally take
about an hour, and the filer has the option of taking the
session in person, on line, or over the phone.  For those that
cannot afford to pay for the counseling the organization is
required to provide their services free of charge. But for
those who can afford to pay the fee will be about $50 depending
on location. Once the counseling is complete you are given a
certificate as proof you have taken the course.

It is up to you to decide what organization you will use for
credit counseling. When you are calling around please make sure
you ask some of the following questions. What services to you
offer? What are you fees? What if I can't afford them? What
qualifications do your counselors have? Will you help me
develop a plan for avoiding problems in the future. If you ask
at least half of these questions, you will have a good idea
about the organization and your decision making will be much
easier.

The educational courses will consist of similar information as
the counseling sessions, budgeting, using credit wisely. Like
the counseling sessions you have a number of options on how you
can take the educational courses, in person, over the phone or
on line.  These courses last longer at about two hours and the
fee is anywhere between $50 to $100. You can seek a waiver if
you are unable to pay. You should also receive a certificate as
proof that you have taken the course.


About The Author: From the Author of "From Credit Despair To
Credit Millionaire" http://www.CarlHampton.com
http://www.fcdtcm.com