We know that bankruptcy is not an easy choice. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 mandates that consumers receive financial counseling prior to the bankruptcy petition being filed and requires consumers to participate in a financial education course before debts are discharged. If you are filing bankruptcy with a spouse, both must attend the counseling and educational course. LifeSpan has been approved* by the Executive Office of the U.S. Trustee (EOUST) to conduct Pre-filing Counseling and Pre-discharge Education within the Northern and Southern Ohio judicial districts. LifeSpan does not receive or pay fees or other consideration for the referral of clients.
*Approval does not endorse or assure the quality of an agency’s services
New bankruptcy laws went into effect in April 2005. They require that all those filing bankruptcy have both pre-filing counseling and pre-discharge education.
A pre-filing counseling session with an approved credit counseling organization should include an evaluation of your personal financial situation, a discussion of alternatives to bankruptcy, and a personal budget plan. This happens after you have seen your attorney but before you go to court.
A pre-discharge class should be conducted by an approved provider and should include information on developing a budget, managing money, and using credit wisely. You must have this education before your debts will be discharged in the bankruptcy.
Chapter 7 Bankruptcy is sometimes referred to as a “straight bankruptcy.” This is usually the bankruptcy people are referring to when they say, “I filed bankruptcy.” They have essentially walked away from their debt. No one can contact them again. It is considered a fresh start.
In Chapter 13 Bankruptcy an individual repays all or a portion of their debts over a three-to-five-year period through a monthly payment plan approved by the Bankruptcy Court. A Chapter 13 is sometimes referred to as a “wage-earner plan.”
Your attorney will help you make the decision as to which bankruptcy to file.
If you can answer ”Yes” to any of these questions you may want to consider filing bankruptcy:
- Is your car is about to be repossessed?
- Are your wages or bank accounts being garnished?
- Are your utilities about to be shut off?
- Do you have over $10,000 in unsecured debt that you cannot repay?
You and your counselor together will review your budget, assets and liabilities and your credit report. What you earn and where you work also play a part in helping you decide the best payment plan for you. Once you have gathered all this information your counselor will work with you to decide your best option.
LifeSpan’s financial counselors offer specialized attention during the bankruptcy process.Rebuilding takes time and commitment . Your LifeSpan counselor will be available to assist you along the way.
If you have unsecured debt we may be able to lower your interest rate and or payment. The majority of debt management clients are able to repay their debt in full in three to five years thus avoiding bankruptcy.
If you are in danger of losing your home to foreclosure, at no cost to you, a LifeSpan housing counselor will work with you and your lender to explore options to resolve your mortgage delinquency.
No, if you meet with a LifeSpan Financial Counselor, no one will know you have met unless you tell them.