Personal Bankruptcy Stigma - Who'll Find Out If I File? - Bolinske Law
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Personal Bankruptcy Stigma – Who’ll Find Out If I File?

Personal Bankruptcy Stigma – Who’ll Find Out If I File?

Fear Of Personal BankruptcyStigma may be one of the most powerful forces in the universe. Because of stigma, individuals will do thing and say things that are often not in their best interest.

Japanese call it saving face and Americans call it honor.

Whatever you call it individuals going through financial trouble are very concerned about it.

The “B” word or bankruptcy is often the last choice individuals going through financial difficulty.

Fear Of Personal Bankruptcy

The real stigma of bankruptcy starts with the fear. Fear of the unknown. Fear that friends and neighbors will find out (unlikely unless you tell them).

Next creditors are trying to scare qualified individuals from filing by saying:

“Filing bankruptcy is illegal.” (untrue)
“You will go to jail if you file bankruptcy.” (untrue)
“You will lose your job if you file bankruptcy.” (untrue)
“The IRS will audit you if you file.” (untrue)

Finally news media is constantly airing or printing stories of how bankruptcy will ruin your credit and make you ineligible for loans. (untrue)

The stories cross political lines are run on conservative programs like Fox News and more liberal programs like NPR.

Who Knows If I File Personal Bankruptcy In Minnesota?


First, let’s look at the worry that friends, family, neighbors or employers will find out that you filed bankruptcy.

The fact is like nearly all court proceedings bankruptcy is a matter of public record. If someone want to do a background search they can find out where you lived, your employer and if you filed bankruptcy among other information

Lists of bankruptcy filers are something someone has to seek out. Either by doing a records search through the U.S Bankruptcy court system which costs money, or by paying for a background search.

The point is someone has to pay money to find the information.

Beyond the fee, each year in Minnesota approximately 13,000 individuals file for bankruptcy.

Chances are that some of your friends, family and coworkers have filed and you did not know.

Creditor Scare Tactics To Stop Bankruptcy Filing


Second, looking at creditor scare tactics, it is obvious why they would use them.

Bottom line, they don’t want you to file so they can continue to try to collect!

Despite powerful laws like the Fair Debt Collection Practices Act (FDCPA) most of the collection industry is a wild west. Given the volume of collections collectors know that most violations will not be caught.

Collectors say you are going to jail if you file, collectors say bankruptcy filing is illegal, collectors say you will lose your job if you file, because those scare tactics work.

Talk to a bankruptcy attorney instead of listening to the stigmas, myths, or falling victim to creditor’s scare tactics.

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