Mounting bills can put stress on any family's budget, but when there isn't enough income coming in to pay off those debts, late bill payments are inevitable. If you find yourself facing insurmountable debt and bankruptcy appears to be your only option, contact an experienced bankruptcy attorney to discuss your options.
What You Need to Know about Bankruptcy
Helpful Information from Attorney Angela M. Cooper
If you are struggling to meet your financial obligations and considering filing for protection under the federal bankruptcy law, you may be uncertain of the law, the process or your rights in a bankruptcy proceeding. This page is designed to answer your basic questions about bankruptcy. To learn more about our bankruptcy practice, see our bankruptcy overview page.
At the Cooper Law Firm LLC, in Mobile County, Alabama, we bring over 10 years of practice experience to individuals considering filing under Chapter 7 or Chapter 13. We believe that every question you have deserves a clear and comprehensive answer. When you hire us to help you through a personal bankruptcy filing, you will work directly with attorney Cooper throughout the process, from the initial petition through post-bankruptcy issues.
To set up a free initial consultation, contact our office online or call us at 251-272-3831 (toll-free at 888-894-4985).
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Contact an experience bankruptcy lawyer in Mobile, Alabama. At the Cooper Law Firm LLC, we have handled Chapter 7 and Chapter 13 filings for over 10 years, preparing all the necessary paperwork and acting as your advocate with creditors, the trustee and the court. We can help you use the bankruptcy laws to get a fresh start. Free initial consultation.
For experienced counsel in bankruptcy, contact attorney Angela M. Cooper, in Mobile, Alabama, to set up a free initial consultation. We have helped men and women get a fresh start with a Chapter 7 or Chapter 13 filing for over 10 years. We built our practice on a commitment to personal service and attention, providing clear and comprehensive answers to all your questions.
Credit Counseling Requirement in Bankruptcy
In 2005, Congress passed and the president signed the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), a bankruptcy reform law. One of the new requirements BAPCPA imposes on a new bankruptcy debtor is to receive credit counseling from an approved credit counseling agency before the bankruptcy filing. A bankruptcy lawyer experienced in consumer credit law, like one from Angela Cooper in Mobile, Alabama, can help debtors determine whether bankruptcy is the appropriate course of action for them and can advise them about these new counseling requirements.
Credit Counseling Briefing
Specifically, a debtor must receive an "individual or group briefing" from a nonprofit budget and credit counseling agency within 180 days before filing for bankruptcy. The briefing can be in person, by telephone or via the Internet. The law provides that the briefing must "[outline] the opportunities for available credit counseling and [assist] such individual in performing a related budget analysis." If a debt management plan is developed in the course of the required counseling, it must be filed with the bankruptcy court.
Approved Credit Counseling Agencies
In most states, the US trustee maintains a list of approved credit counseling agencies for use in the court districts in those states. In Alabama and North Carolina, this list is approved by bankruptcy administrators. The list of approved agencies is available on the US courts Web site. An approved agency is first on the list for a six-month probationary period, renewable in one-year increments. Approval can be revoked at any time. Interested persons can ask the court to review the approval of any agency.
To obtain approval, an agency must have qualified, experienced counselors who provide adequate counseling and have no financial interest in the counseling outcome; handle client funds securely; maintain an independent board of directors; charge reasonable and sliding scale fees; make certain disclosures; possess financial security to oversee repayment plans of clients; and maintain "quality, effectiveness, and financial security of the services it provides."
Exceptions to the Credit Counseling Requirement
There are some exceptions to the counseling requirement for certain debtors in particular situations. First, the court may waive the counseling requirement if there are "exigent circumstances" and the debtor made a request for counseling that an agency was unable to provide within five days. Second, a debtor is excused from the requirement if incapacitated by mental illness or deficiency, if physically impaired such that he or she is unable to participate with reasonable effort or if on active military duty in a combat zone. Third, counseling is not required if the trustee or administrator in a particular court district determines there are not enough approved credit counseling agencies available.
Criticisms of the Requirement
The credit counseling requirement has many critics. One argument is that it is too little and too late for a debtor in bad enough financial shape to be on the brink of bankruptcy. Supporters of the requirement feel that it will weed out people who are in financial crisis because of their own voluntary behavior; however, counseling agencies have found that most people counseled have had legitimate problems not caused by their own recklessness. Dismissal of a bankruptcy case for not obtaining required counseling is seen by some as harsh treatment for a debtor facing, for example, foreclosure on a modest home. Finally, depending on the interpretation of the judge, the dismissal could weaken the automatic stay in a subsequent bankruptcy filing.
Conclusion
Consumers considering bankruptcy as a future option should investigate the credit counseling requirement well before the anticipated bankruptcy filing. The experienced consumer and bankruptcy law attorneys at Angela Cooper in Mobile, Alabama, can be just the counselors and zealous advocates such a consumer needs in trying economic times.
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