Credit counseling and debtor education: which course is which?

How do the courses differ?

People often assume that the course they took before filing settles the matter. It does not. The second course has its own purpose, its own deadline and its own certificate.3

What is credit counseling, and when must you take it?

Credit counseling is a briefing from an approved nonprofit agency. It can be one to one or in a group, by telephone or on the Internet. It goes over the credit counseling options open to you and helps you with a budget analysis.2

You must receive it within the 180 days before you file. Every person who files must do it, including people whose debts come mainly from a business.1 2 4

Only approved agencies count. The U.S. Trustee Program publishes the approved list by state and judicial district, and it does not recommend any particular agency. In Alabama and North Carolina, bankruptcy administrators approve the agencies and keep the lists.11 4 12

The agency gives you a certificate that describes the services you received. You file it with the court, together with a copy of any debt repayment plan you worked out with the agency. If you have had the briefing but the certificate has not reached you yet, it is due within 14 days after the case begins.13 14

Are there exceptions to credit counseling?

Yes, but they are very limited, and each one is decided by the court.3

• The court can excuse a person who cannot complete the briefing because of incapacity, disability or active military duty in a military combat zone.2
• A temporary waiver is possible in an emergency, when you asked an approved agency for counseling and could not get it within 7 days. That waiver ends no later than 30 days after you file, and the court may add 15 days for cause.2

If you think one of these applies to you, a lawyer or the court's own information for filers is the place to check before you file.

What is the debtor education course, and when is it due?

Debtor education is a separate course on personal financial management, taken after you file, from a provider the U.S. Trustee Program has approved. It must last a minimum of two hours.3 5 4

In a Chapter 7 case, the certificate must reach the court within 60 days after the first date set for the 341 meeting. In a Chapter 13 case, it is due no later than the date of your last plan payment, or the date you ask for a hardship discharge. The court can extend the time.14

Missing it costs the thing you filed for. In Chapter 7 the court does not grant a discharge to a debtor who failed to complete the course, and in Chapter 13 the court cannot grant the discharge until the course is done. The exceptions are narrow: districts where the available courses are found inadequate, and debtors who are disabled, incapacitated or on active military duty in a combat zone.8 9 6 7

Who files the certificate after the course?

Either the provider or you. A provider may file the certificate of completion with the court on your behalf, but it is not required to. If it only hands the certificate to you, you must file it yourself.5 4

There is no longer an official form for this step. Official Form 423 was abrogated effective December 1, 2024. You now file the certificate the provider issued, unless the provider has notified the court directly.15 14

Ask the provider which of the two it does, and keep a copy either way. If a certificate is lost or has an error, the agency or provider that issued it replaces or corrects it.5 4

What if a certificate is late or missing?

For credit counseling, a case may be dismissed if the counseling was not done before filing. If you had the briefing but the certificate has not arrived, it can be filed within 14 days after the case begins.3 13 14

For debtor education, the court can extend the time to file the certificate, so ask before the deadline passes if you can. If the case was closed without a discharge, getting one later means asking the court to reopen the case. Under the fee schedule effective December 1, 2023, the motion to reopen costs $245 in Chapter 7 and $235 in Chapter 13, the fee must be charged when a case closed without a discharge, and the court may waive it in appropriate circumstances.14 16 17 18 19

What do the courses cost?

Each agency and provider sets its own fee and must tell you all of its fees, including any separate charge for the certificate, before the session begins. It must provide the service and the certificate without regard to your ability to pay.4 5

The U.S. Trustee Program presumes a fee of $50 or less to be reasonable, and a higher fee needs its approval in advance (FAQ pages updated January 15, 2025). If your household income is below 150% of the poverty level, you are presumed to qualify for a free or reduced-fee session, and the same applies to the debtor education course.4 5

Spouses who file together may attend the same session, and each receives a separate certificate.4 5