Clients often ask me whether other people will find out about their bankruptcy. They do not want their employer, prospective landlords or their friends to find out. They feel they will have difficulties with certain affairs if their bankruptcy becomes public knowledge.
Bankruptcy Court records are public records, but they are not generally available on the internet through a simple search. This is because the records are behind what is called a pay wall, meaning that to find them, one has to have an account with the court system and pay for the search. Anyone can get an account, and the costs are very low, but few people have such accounts. In addition to lawyers, many news organizations have accounts, which is why when someone famous files for bankruptcy, the details of the case are reported. However, if you are not famous, your filing will almost certainly not turn up through an internet search.
In some small towns in the United States, local newspapers will print lists of people who have filed for bankruptcy, but in such a small town such things are hard to keep private. In large cities, and especially in New York City, your name would only appear in the papers if you are famous. And if you are famous, you would not be able to keep it private in any event.
Credit reporting companies such as Experian, Equifax and Trans Union do receive a list of all cases filed, and report it on your credit report for 10 years. If someone gets a credit report on you, they will see your filing.
Prospective employers can run a credit report on you, and will find out you filed bankruptcy. In some cases, you may not get a job because of the bankruptcy, even though there are provisions in the bankruptcy law against such discrimination. However, if you had not filed, the employer would still get a credit report, and would then see that you have overwhelming debts that are not being paid, which might be worse than having filed for bankruptcy.
There is one employer in the New York City area that does get credit reports on prospective employees that I am familiar with because when this employer finds that they have large debts, they recommend to the prospective employee that they file for bankruptcy so that their financial problems will not interfere with their work. They send these people to my office and we file for them. Then they go to work. This should be the attitude of all employers on this issue: someone who has financial problems and has filed for bankruptcy is someone who will not be worrying about money instead of concentrating on their work.
Landlords also can seek credit reports, and I am sure that some do. However, I have never had a client call me and tell me they did not get an apartment because of their bankruptcy. Again, someone who has filed will have more money available to make each month’s rent, so someone who has filed and now has a decent income is a good tenant to have.
Many years ago, two people who lived in my old neighborhood came to me to file bankruptcy cases for them. Each of them asked me to make sure the other did not find out that they had filed. Both of these people filed and neither ever knew the other had filed. Anyone who files for bankruptcy can expect that this will be the case for them, that very few if anyone will ever know they filed.
Allan Bloomfield practices bankruptcy law in Forest Hills, Queens. Contact Allan today for a free consultation.
