Monday, September 12, 2011

FAQ #16: Who will know about my bankruptcy?

The bankruptcy code requires that you disclose all debts owed, and those creditors will be sent Notice of the bankruptcy filing. Therefore, anyone that you owe money to will learn about your bankruptcy.

Additionally, many bankruptcies are filed to discharge un-liquidated or contingent claims – claims arising from a lawsuit, for example – so the adverse party in the lawsuit will be aware of your filing.

Co-debtors must also be disclosed and will receive notice of filing; as will anyone that holds a leasehold interest with the debtor, such as a landlord or tenant, regardless of whether the rent is up to date.

In addition, bankruptcy is a court case. The existence of a court filing in any court is a matter of public record, so there will be a public record of a bankruptcy filing. However, this does not necessarily mean that the information will be easily obtainable by the general public. For example, in order to view bankruptcy case documents, one must either go to the Federal Courthouse in the district where the case was filed, or have the requisite credentials to obtain a PACER account (on-line access to Federal Court records). Third-party agencies can also determine that a case was filed through various public records search engines. Credit reporting agencies (Equifax, TransUnion and Experian) are able to obtain similar information. This means that anyone authorized to review your credit report will see your bankruptcy, such as prospective employers conducting an authorized background check or loan officers acting on a credit application.

1 comment:

  1. Lol...everybody knows about a person's bankruptcy! The minute the bank gets wind of your poor financial condition, well thats the end!


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