Bankruptcy Questions: Is Credit Counseling Required to File Bankruptcy in Ohio?

When you decide to file bankruptcy in Ohio, there are some top bankruptcy questions you will likely ask your Ohio bankruptcy lawyer. These could be questions like: Can bankruptcy stop eviction? What property is exempt? Does bankruptcy affect employment? You might even wonder if bankruptcy is the best course for you. The experienced chapter 7 bankruptcy lawyers at Hausen Law know that you’ll have many concerns, and they are ready with the answers you need. 

Perhaps you’ve heard about credit counseling that is required after a bankruptcy case, but you may not be familiar with counseling being a prerequisite prior to filing bankruptcy in Ohio. Well today we’re answering the question you didn’t know you had! So, do you need to take a credit counseling program in order to file for bankruptcy in Ohio?

When Credit Counseling Is Required

The answer to this question is simple: every individual who files for any kind of bankruptcy in Ohio–that’s chapter 7, chapter 11, or chapter 13 bankruptcy–is required to obtain credit counseling prior to filing with the court. Whether debts are primarily personal or business in nature, this still holds true. Individuals and joint filers can attend the same counseling sessions, where they will receive personalized help, and each individual will receive their own certificate upon completion.

What Does Credit Counseling Involve?

During a credit counseling session, the counselor will provide the individual with an analysis of their current financial situation. They will discuss the reasons behind the financial difficulties that the client is experiencing and may help them to find an alternative to bankruptcy that will help them to move forward. The general goal is to ensure that the client has explored every possible option before declaring bankruptcy.

It is common for a credit counseling agency to offer an online, on-demand course, with follow up handled in a live online session or over the phone with qualified counselors. This course will help individuals to understand their options, not limited to filing for bankruptcy, and will include pre-recorded information that is typically followed by a quiz. Once the course has been completed, a credit counseling agency can often send the completion certificate directly to a client’s bankruptcy attorney. By law, a credit counseling agency is required to provide advice specific to you and your situation, not merely generic guidelines.

A typical counseling session lasts about 60 minutes on average, but it could take longer than that if an individual’s particular circumstance demands it. In other cases a counseling session may finish in less time. While there are common average lengths of counseling sessions, there is no required minimum duration. Counseling sessions are required to occur within a 180-day window prior to filing for bankruptcy in Ohio.

Upon completion of the credit counseling course, an individual might decide that they do not wish to file for bankruptcy. Whatever the outcome, a discussion with an experienced chapter 7 Ohio bankruptcy lawyer will ensure that they are making the best decisions for their unique circumstances. This credit counseling course is a complement to post-bankruptcy counseling.

Where To Go For Credit Counseling

For a credit counseling agency to be recognized by the court, it needs to be approved by the United States Trustee Program (USTP). At Hausen Law, we work with Allen Credit & Debt Counseling Agency via our specially designed online course. This agency is approved by the USTP to offer both pre- and post-bankruptcy counseling.

Who Pays for Credit Counseling?

Counseling courses are generally not very expensive–roughly $50 per session–but if this fee poses an undue burden and this is a filer’s first time declaring bankruptcy, exceptions may be available. Especially for individuals whose household income is less than 150% of the federally established poverty level, a fee waiver may be possible.

In some cases, if it has been previously arranged as part of their services, and it is in agreement with any applicable laws, regulations, and ethical requirements, a bankruptcy attorney may handle the payment. It’s also possible that another third party may handle the fee on the client's behalf. Situations will vary by situation.

Rely On an Experienced Ohio Bankruptcy Lawyer

If you’re considering filing for chapter 7 or chapter 13 bankruptcy in Ohio and have questions about credit counseling, it’s time to start working with an experienced Ohio bankruptcy lawyer. James Hausen and his skilled team of legal professionals can help you to determine the best course of action, like getting connected with credit counseling services. Give us a call or fill out our online contact form and we will be in touch. Hausen Law is happy to serve all of Northeast Ohio, including the Akron, Canton, Cleveland, Wooster, Dover/New Philadelphia, and Youngstown communities. Contact us today to set up a free consultation.