One of the requirements of a court approving your bankruptcy case is that you undergo a credit counseling session. This session must take place before the actual bankruptcy process begins. For Michigan residents new to bankruptcy, it should be emphasized that credit counseling is not meant to be a difficult process. It does not take long and accommodations can be made if hardships are involved.
The U.S. Federal Trade Commission (FTC) explains that within 180 days before you file for bankruptcy, you must complete a credit counseling session with a government approved counseling organization. You can expect to discuss your current financial situation, alternatives to going bankrupt, and how to form a personal budget. You should not expect a lengthy session, however. Usually, these sessions last about an hour to 90 minutes long.
It is natural to be concerned about whether you have to travel to receive your counseling. Some people, due to work obligations, cannot go far from their homes, or health issues may make it difficult to leave home unless it is absolutely necessary. While you can receive your counseling session in person, it is not required. Counseling agencies also offer counseling over the phone or over the internet.
Potential bankruptcy filers already have issues with money, so spending any more of it is liable to be a concern. Credit counseling agencies do charge fees for counseling, usually $50. This is enough for some people, but even this amount may be too much for people burdened with debt. If this is the case, you can ask a counseling organization to waive the fee before you begin the counseling. If you are unable to pay the fee, you will likely receive counseling for free.
Also be aware that a counseling organization is required to discuss fees with you before your counseling begins. You should not be blindsided with fees after your counseling is concluded. As an added convenience, a counseling organization cannot charge you another fee to give you a certificate of completion. This certificate is to be filed with a court as proof that you have finished your credit counseling.
The flexibility involved in credit counseling means that people in Michigan looking at bankruptcy have options available that may accommodate them. Keep in mind that this article only provides general information and not legal advice.