It’s not uncommon for young people to graduate college only to find themselves swimming in significant debt. Others may find themselves uninsured because they’re in between jobs when they face a medical emergency and end up with a pile of bills. These are just two examples of situations that may warrant a bankruptcy petition.
Yet, many people don’t file bankruptcy when they should because they fear that it will adversely impact their ability to secure a job. You shouldn’t get too caught up on this, though.
Why job seekers fear having bankruptcy on their record
A few decades ago, employers seldom checked an employee’s background or credit report before extending them a job — but that has changed. Employers can perform a basic online search and find almost anything about a prospective employee. If you read most job applications nowadays, you’ll note where it says that their extension of an offer is contingent upon your completion of a successful background check — and bankruptcy will show up in that report.
Laws prohibit employers from discriminating against workers with bankruptcies
The good news is that there are anti-discrimination provisions contained within the Bankruptcy Code. These prohibit employers from demoting you, reducing your pay or firing you simply because you filed for bankruptcy or recently had a bankruptcy discharged.
While this rule mostly only applies to people currently in their positions, not someone looking for a job, a bankruptcy may not sink your job prospects even if an employer does a credit check. An employer is more likely to worry about someone with a pile of unpaid bills and debt collectors at their door than someone who has acted responsibly to manage an unreasonable debt load through legal means. The chief worry for an employer is that someone with massive debts may steal from them or their customers– but bankruptcy clears those debts for you.
Moving forward with your bankruptcy
Mounting debt can limit your ability to secure housing, an automobile, loans and other areas of your life here in Michigan. An attorney in Westland can help you better understand your legal options and decide if bankruptcy is right for you.