Every state may be slightly different, but as bankruptcy is ruled upon by the Massachusetts court, it will create a public record. This record will be available to anyone in the court at the time of the ruling or anyone that has access to bankruptcy rulings and information.
The big difference in Massachusetts is that anyone who usually does not have access to this information has to have a PACER account to look it up. A PACER account must be paid for, and most laypeople don’t want to pay for this service.
Bankruptcy and debt relief attorneys, firms, etc. use this service all the time to keep up with their cases and get other information they may need. You may be concerned that your friends, employer, landlord, or others may get this information, but the truth is that rarely do they want to pay for a PACER service. The only other way to obtain the information is to go to the courthouse to check the records, which is probably an even rarer occurrence.
If the source looking for the information can pull a credit report, the bankruptcy filing will likely appear on it. If you file a Chapter 7 bankruptcy, it will stay on your credit report for ten years, and a Chapter 13 filing will appear on your credit for seven years.
The good news is that nothing lasts forever, and over time the impact of filing bankruptcy on your credit will diminish. First of all, a new creditor will know that your credit history and financial issues have been put back in line, so you now have a chance to start over. It may take a while for this to happen, but it will occur. As you get more new accounts and keep them current, your credit will improve. It can also be used as a learning experience, and lenders may feel you can handle credit responsibly.
Today especially, your inability to pay may have been caused by events you could not control. You may have suffered illness, job loss, etc., that caused the issue and eventually, hopefully, that issue is resolved. Some lenders may even take these events into account and see you as a good risk to start building your credit again. Overall, your past and future creditors will usually be the only people aware of your bankruptcy filing.
Bankruptcy is a serious legal action, and your bankruptcy attorney will be invaluable in making sure that you are approaching it in the best way possible. Your Massachusetts attorney will be dedicated to getting your life and finances back on track.
Will Bankruptcies Appear in Background Checks?
Bankruptcies do not normally appear in results of criminal background checks, and under the Fair Credit Reporting Act (FCRA), bankruptcy filings cannot be reported in pre-employment screenings once they are ten years old. This rule may vary slightly from state to state, so it is always best to ask your bankruptcy attorney specific questions.
The bankruptcy laws in Massachusetts are numerous and complex. Your case may seem like a simple one, but it is always unique. Bankruptcy attorneys helping clients obtain financial freedom, are the only ones, besides yourself, that know all the facts about the intricacies of your finances. They alone, in discussion with you and your family, will guide you to the best outcome possible.
Overview of a Bankruptcy Filing
The provisions of the Massachusetts bankruptcy code are complicated. They are designed however, to provide a legal means of helping you, your family, or your businesses get their finances back on track. Some families do mismanage their finances, but others (including businesses) have unforeseen circumstances that force them into bankruptcy to organize their debts and start fresh.
In your meetings with your bankruptcy attorneys, you will probably discuss the four basic types of bankruptcy filings:
- Chapter 7 — Liquidation — This type of bankruptcy is designed for individuals and businesses experiencing financial difficulty that cannot nor do not have the ability to pay their existing debts. The purpose of filing a Chapter 7 case is to obtain a discharge of your existing debts. A bankruptcy discharge is a court order releasing you from liability for many types of debts.
- Chapter 11 — Reorganization — This is designed to reorganize a business so that the business can reorganize its debt and continue to operate and survive.
- Chapter 12 — Specifically, for family farmers and fishermen, and used only to permit family farmers to repay their debts over time. If your debts do not exceed certain dollar amounts outlined in the Bankruptcy Code, eligibility can be determined.
- Chapter 13 –Requires repayment of all or part of the debts of an individual with regular income. They are generally used for individuals with regular income who are temporarily unable to pay their debts. Chapter 13 gives them the option to pay their debts in installments over a period of time.
All these types of bankruptcies have different rules, uses, and restrictions. Only after a full review of all your finances will you and your bankruptcy attorney be ready to chart out the best form of bankruptcy for you. Your bankruptcy attorney will create a personalized plan for you.
When you start this process, questions like “who will find out about my bankruptcy?” will become less important. As stated, the benefits of bankruptcy were designed to help you, your family, and businesses survive and thrive under severe financial problems that you possibly couldn’t avoid. Remember, that although your bankruptcy is a public record in Massachusetts, it is not easy to find nor available to most sources.