Bankruptcy can impact many areas of a person’s life. After the bankruptcy is concluded, the person filing for bankruptcy has to recover financially and build up his or her credit again. This can make buying a home, renting an apartment, and even getting a job in some cases more difficult.
Not all jobs require candidates to reveal whether or not they have previously filed for bankruptcy. However, many jobs in the government that require security clearance, or in the financial sector where an employee may be required to handle money, are difficult to obtain if a person has previously filed for bankruptcy. In other fields of work, a prior bankruptcy filing will have no effect on a person’s employment prospects because it has nothing to do with the work the person will be doing.
In some cases, even when a person’s bankruptcy history is not requested on the initial employment application, it can be revealed through a mandatory background check. Bankruptcy information is also publicly available and reported on people’s credit report. Therefore, the bankruptcy information can still be seen on the credit report if the employer requests one on a prospective employee. Job seekers do not have to consent to the employer accessing their credit reports, but in most cases failing to give consent could be a reason for the employer to deny them a job.
For some employers, a past bankruptcy may signify irresponsibility. This is an arbitrary conclusion, especially for people who file bankruptcy due to unexpected expenses such as medical debt. If a candidate has a chance to explain the decision to file for bankruptcy, he or she may try to do so to mitigate the negative effects. The explanation is not legally required, but it may help because it may show the employer that the bankruptcy had nothing to do with the person’s ability to be responsible.
Employees who already have jobs cannot be fired solely for filing bankruptcy. Employees should be careful when handling issues related to their bankruptcy on company time, arriving to work late, or missing work because of the bankruptcy filing process. If an employee breaks employer rules, even if the breaking of the rules is related to the bankruptcy filing, the employer can fire the employee.
People who choose to be self-employed may not have the same concerns as those seeking formal employment from a business or organization. A self-employed person who has a history of bankruptcy may be affected by this history when seeking capital funding. In some cases, the person may have to provide collateral in order to get loans that other entrepreneurs may secure without collateral. In addition, the person may also be restricted from qualifying for some grants. Nevertheless, it is possible to start and flourish in a business after filing for bankruptcy.
Contact Us for Legal Assistance
Bankruptcy in some cases is unavoidable and necessary, but in some cases, people should consider other alternatives in order to avoid the consequences of filing for bankruptcy. If you are considering filing for bankruptcy, schedule a consultation to discuss bankruptcy, debt settlement, and other ways you can manage your debt. Call us at Resnick Law, P.C., in Bloomfield Hills and Detroit, Michigan.
(image courtesy of Joshua Ness)