Whether you are seeking debt discharge through Chapter 7 or Chapter 13 bankruptcy in California, you must complete the debtor education course as a requirement of the US Bankruptcy Code. The debtor education course is intended to teach you fundamental personal finance management skills that you'll need to be financially successful after bankruptcy. Here is a rough breakdown of what you can expect from the bankruptcy debtor education course.
The Debtor Education Course
The actual debtor education course is easier than ever to complete. Courses are available anytime, online and come in written, audio, and video formats. Not only can you complete the course at your convenience, it usually only costs $10-$25. The course itself lasts no longer than 2 hours and, therefore, can be completed in an afternoon. As a matter of due diligence, you must ensure that the debtor education course you complete is approved by the U.S. Trustee Office. By doing so, you'll ensure you are dealing with a legitimate organization that has been formally accepted by the US Bankruptcy Courts.
Course Subject Matter
While completing your debtor education course, you'll receive significant information regarding budgets, money management, using credit intelligently, and dealing with future financial crises. Moreover, the “pre-discharge” debtor education course will supply you with information on how to make better financial choices in the future and ultimately avoid a second bankruptcy.
Exemptions from Debtor Education Course
Under select circumstances, you may be exempt from having to complete the debtor education course. For instance, if you have a disability which prevents you from taking the course or are on active duty or in a combat zone, you are exempt from completing the debtor education course to receive a discharge.
Pre-bankruptcy vs. Debtor Education
There are actually two courses you must complete to receive a bankruptcy discharge. The first course is the pre-bankruptcy credit counseling, and the second is the debtor education course. The primary difference between the two courses is that you must complete credit counseling before filing bankruptcy and the debtor education course before receiving a discharge. Additionally, the pre-bankruptcy credit counseling class revolves around evaluating whether you should file bankruptcy or if you can reorganize your debt without it. Whereas, the debtor education course will focus on preventing burdensome debt in the future.
Bankruptcy Discharge Requirements
If you do not complete the debtor education course within the designated timelines, your bankruptcy case will be dismissed without discharging your debt. In Chapter 7 bankruptcy, you must complete the course within 60 days of your 341 meeting. Whereas, in Chapter 13 bankruptcy, you must complete the debtor education course before you pay your final Chapter 13 reorganization payment. Once completed, your Citrus Heights bankruptcy attorney will file your certificate of completion with the California Bankruptcy Court to ensure your obligations to pay back eligible debt are extinguished.