Bankruptcy Credit Counseling Solutions?

Apr 17th, 2014 | By | Category: Debt

If you are thinking about filing for bankruptcy, then you may know that you will have to go through a credit counseling program before your case is completed. Credit counseling is court-ordered as a portion of the bankruptcy process, but regrettably, many people discount the usefulness of good credit counseling simply because it is mandated by the court system.

However, credit counseling is a tremendous learning experience. And, we recommend that even though you are not filing for bankruptcy, you go ahead and to adopt a credit counseling course. If you are struggling with fiscal issues, credit counseling is a good way to get a great deal of those issues back under control. Let’s take a look at a few reasons why.

Bankruptcy will generally cause the most damage to your credit report. Chapters 7 and Chapter 11 bankruptcies remain on your credit report for 10 years from the date filed. A Chapter 13 bankruptcy will remain on your report for seven years from the date of filing. The accounts associated with a bankruptcy or debt settlement are removed from your credit report seven years from the first date of delinquency. Begin by consulting with a nonprofit credit counseling agency member of the …

When you go through credit counseling, you will enjoy access to the expertise and experience of a professional. This is a great time to ask questions you have always wanted answered. Whether you have questions about debt repayment strategies or budgeting, here’s your chance to ask questions that relate to your unique situation.


You’ll get debt consolidation assistance. One of the main benefits of credit counseling (whether you face bankruptcy or not) is that you will be able to work on getting your debt rolled into a single, easy-to-manage loan. This can be a beneficial strategy for many people.

This debt reduction strategy is particularly valuable for those people who’re paying their monthly debt bills regularly, but just want their debt repayments to become more ordered. A debt consolidation loan merges all your loans into one loan, that is, you do not have to pay your creditors separately. The company providing you the debt consolidation loan will pay off all your debt, while you’ll make the monthly payment to the company, and that too at an interest rate. This is many times lower than the full amount of the interest you were paying to your creditors. Moreover, the interest of debt consolidation loan is usually tax deductible. A collateral and good credit score are the two primary requirements for getting a debt consolidation loan.

FAQ’s: Credit Counseling?
Im going to file Chapter 7 Bankruptcy, do I have to take credit counseling before I do?

  • You bet: "In addition, no individual may be a debtor under chapter 7 or any chapter of the Bankruptcy Code unless he or she has, within 180 days before filing, received credit counseling from an approved credit counseling agency either in an individual or group briefing. "

  • i would

  • Opt for Chapter 7 without counseling: The Chapter 7 bankruptcy is applicable if you have no regular sources of income. It works by reducing or clearing off all your debts. You can then make a fresh start without having to worry about having to pay your debts. Once you file for Chapter 7 bankruptcy, the bankruptcy court assigns a trustee who works as an intermediary between you and the debtors. He oversees everything and checks out if the bankruptcy plan is going as planned.

  • Fees, interest rates and other costs often make this debt reduction strategy a costly proposition.

    You can get general money management advice. If you have never been sure about how to set up a budget, here’s your chance to get help! Perhaps you do not know how much to allocate to each category. A credit counselor can advise you on the best way to allocate your funds.

    If you think you might have to complete for bankruptcy in the future, a credit counseling service might be in a position to help you work out your financial situation out of the legal process. Or, if bankruptcy is the correct option for you, a credit counseling service can help you identify a bankruptcy attorney. Or, the service can at least advise you on how to select a good bankruptcy attorney.


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