Shopping For Bankruptcy Counseling And Education

As the economy fails to rebound, more and more Americans have chosen to file for bankruptcy protection.  The numbers are staggering.  The American Bankruptcy Institute reports that as of February 2009, personal bankruptcy filings reached 111,693, a 14% increase from only a year ago, and are up 32% over 2008 (according to the National Bankruptcy Research Center).

The Executive Office for U.S. Trustees (EOUST) requires that all filers receive certification for both pre-bankruptcy counseling and debtor education.  The counseling, which may also be provided in a group setting, includes a review of your budget, the alternatives to bankruptcy, consequences of bankruptcy, while the education component covers how to reestablish personal finances, rebuild credit and avoid getting back in debt.

It’s more critical than ever for those getting bankruptcy counseling and education to make sure to find a legitimate, nonprofit organization, such as ClearPoint Credit Counseling Solutions, to provide objective counseling and education.  ClearPoint offers these suggestions for finding a reputable bankruptcy education provider:

Is the agency a 501(c) (3) nonprofit community organization not affiliated with a particular attorney?

In general, nonprofit agencies are not established for the purpose of making a profit, but to follow a mission, often involving education.  A non-profit organization committed to education is more likely to offer unbiased information.

Is the agency affiliated with a national association such as the National Foundation for Credit Counseling (NFCC)?

NFCC membership signifies high standards for agency accreditation, counselor certification and policies that ensure low-cost, confidential services.

What related services does the agency provide and how long have they been in business?

The more well-rounded services offered by an organization, the better.  Counselors and educators who provide related services will be able to answer more personal finance-related questions and put your situation in perspective. A healthy track record indicates an agency’s soundness.

Is the agency accredited by a third party such as the Council on Accreditation?

Such notable endorsement ensures the organization meets the highest standards of stability, service and results.

Check with the Better Business Bureau.

A quick search of charities at www.bbb.org will allow you to see the BBB’s “grade” for the organization and determine if it’s an accredited BBB member.