Although filing bankruptcy is becoming a more common and accepted thing, many people still worry about who will find out they filed a Chapter 7 or Chapter 13 case. All bankruptcy filings are a matter of public record, so it is possible for anyone who is searching to find out about your case. However, the reality is that most of the people you know will never be aware of your filing unless they are your creditor or you tell them about it yourself.
There are certain parties that will receive notice of your case from the bankruptcy court. These parties are all of the people you owe money to, including loans from a friend or relative. It is important that you do not attempt to pay-off the loan you owe to a friend or family member just before your bankruptcy petition date to prevent them from receiving notice of your case. This is considered a “preferential payment” and the trustee will likely take action to seek repayment of the amount from the party you paid.
If you file for debt relief under Chapter 13, your employer may find out about your bankruptcy. If your Chapter 13 plan payments to the trustee will be made by payroll deductions, the person who handles payroll for your employer will be put on notice. You should also be aware that if your employer (or a potential employer) requests a copy of your credit report, your bankruptcy case will be noted on it.
It is normal to be concerned about other people finding out about your personal bankruptcy case. However, there is not the same stigma attached to it that there used to be. In fact, most people are more understanding because they are facing financial struggles too. You might be surprised at how many people you know that have previously sought bankruptcy relief!
The personal bankruptcy process can be simple and effortless if you retain an attorney who will explain the steps to you. Ms. Anderson is dedicated to walking you through each step, explaining the process along the way. At The Law Office of Diane Anderson, we are determined to help our clients obtain the best results possible.