What Bankruptcy Lawyers Need to Know About Credit Counseling
Credit counseling is required before a debtor can file for bankruptcy. Here's how to help your clients through the process.
  • legal tech
  • credit counseling
  • DebtorCC
Published on Oct 19, 2021


Part of your role as a bankruptcy attorney is ensuring your clients fulfill each and every requirement to get them through the bankruptcy process. One key element is credit counseling, which is required for Chapter 7 or Chapter 13 bankruptcies.


Here is your guide to what credit counseling entails, why it’s required, and how to make it even easier for your clients to complete.



What is credit counseling?

Credit counseling helps debtors figure out if they really need to file for bankruptcy or if they have other options to resolve their debt. These options could be creating a new budget or enrolling in a plan to pay off everything within a certain timeframe. Sometimes, however, credit counseling will reveal that a debtor’s best option is filing for bankruptcy.


A counselor works with the debtor and assesses what their options are. It’s ultimately up to the debtor which avenue to take, but credit counseling can help them understand their situation better and find the right solutions.



What is the credit counseling requirement?

Before an individual can file for bankruptcy, they must complete one credit counseling course, known as pre-bankruptcy credit counseling. The purpose of this course is to help people get a sense of their debt and make an informed decision. It shows the court that filing for bankruptcy really is their only option.


Many organizations and agencies offer courses that will qualify, but take a look at the government’s pre-approved provider list. The client will receive a completion certificate, which is included when filing for bankruptcy. The client has 180 days to file after the first credit counseling course.


Then, there is a second course requirement that the debtor needs to complete after filing but before the debt is discharged.



How to help debtors meet this requirement

Lawyers can help their clients meet credit counseling requirements by integrating the right technology. A software like NextChapter helps clients get their courses knocked out and the certificate obtained in no time. NextChapter partners with DebtorCC to complete both required courses so the process is more efficient.


Benefits of offering a credit counseling course in your legal software:

  • Smoother debtor education process
  • Reduce back and forth with a lot of emails or faxing
  • Everything is linked to the software to more easily store case information
  • Clients are more likely to complete the courses and will do it faster


Here's how it works in a few simple steps:

  1. Connect DebtorCC and NextChapter by entering your login credentials in DebtorCC, or signing up for a new account
  2. Invite the client to take the course
  3. Track all of your clients' progress at once in an easy-to-use dashboard.
  4. Once done, the date of completion and printable certificate will automatically populate in the corresponding case.



NextChapter makes it easy to integrate everything in one place. Help clients complete their credit counseling requirements by sending out invites and tracking their progress so their case is resolved more quickly.