If you have been contemplating declaring bankruptcy, or are in the process of doing so, you probably already know that you’re going to have to submit a great deal of information to the bankruptcy court. You’re might also be feeling a bit embarrassed about the whole procedure.
In your head, you know that bankruptcy is the best course of action – it’s going to give you a fresh start, a chance to get out from under crippling debt, and hope for a brighter future. However, your heart is screaming “What if Bob next door finds out? He’ll tell the whole neighborhood, and I’ll never live it down!”
What Financial Information Is Disclosed?
When you declare bankruptcy, the information that goes into your public record includes, but is not limited to, the following:
- Cash that you have on hand
- Money in your savings, checking, and other financial accounts
- Automobiles, boats, other vehicles, and accessories for same
- Art and collectibles
- Stocks and bonds
- Daily living expenses
- Dental and medical expenses
- Credit card payments
- Other debt
- Marital status
- Your address
- Names/addresses of creditors
- Alimony and/or child support
- Last four digits of your social security number
- Tax identification number
Who Can Access This Information?
The public DOES have the right to see the documents that you file with the bankruptcy court. However, unless your unsecured assets are worth more than $15,000, your bankruptcy will not be advertised.
The only people who have to be notified are:
- Your existing creditors
- Your potential future creditors (those to whom you apply for credit after your bankruptcy and before your discharge)
- The government
- Credit bureaus
Your employer doesn’t need to know about your bankruptcy, unless, of course, your wages are being garnisheed and your bankruptcy trustee has to take measures to stop this from happening. Your employer is prohibited by law from firing you because you have filed for bankruptcy.
What About Bob?
Unless Bob has a real hate going for you, and makes a habit of looking into your affairs, you’re probably safe. As stated, the public has the legal right to view the documents that you have filed, or will file, with the court. But since your bankruptcy won’t be advertised unless you have significant unsecured assets, Bob won’t know that there’s even anything to look for. He’s not going to find what he doesn’t know exists.
Unless you tell Bob, your secret is probably safe. Your other neighbors won’t know, neither will your in-laws or even your Mom – unless you tell them. Even though there’s no shame in using bankruptcy as a tool if you find you’re in so deep that you can’t dig out, you can manage your bankruptcy with the assurance that you don’t have to go out in public with a scarlet “B” for “Bankrupt” emblazoned on your forehead.
It’s Really Up to You
It really is pretty much up to you who finds out, and you can show up at the neighborhood barbecue with your head held high, secure in the knowledge that your financial situation is as confidential as possible. Just go easy on the beer at that barbecue, because it’s a time-honored axiom that the only way two people can keep a secret is if one of them is dead. If you end up crying drunkenly on Neighbor Alice’s shoulder about your impending bankruptcy, unless you want it to get back to Neighbor Bob, you will have to kill Neighbor Alice. And that’s a whole new legal problem.