Will Bankruptcy Keep Me from Getting a Job?

Posted on May 21, 2014 at 2:27pm by

Our Attorneys Dispel the Myths of Bankruptcy

Some people shy away from filing for bankruptcy because they feel there is a stigma associated with it. However, living with bad credit can impact your finances and professional life significantly more than filing for bankruptcy and fixing the problem. For many, the first step towards improving your credit when you are overextended and defaulting on debt is to file for bankruptcy. A common concern for many is whether a bankruptcy filing will affect their employment or future prospects.

Will Prospective Employers Know About My Bankruptcy?

Bankruptcy should have little to no bearing on your candidacy for a potential job; however, when applying for jobs in the private sector, you may have to submit to a credit check. A private sector employer cannot issue a credit check without your permission.

It does not have to be a bad thing for a private employer to find out about your bankruptcy when running a credit check. Bankruptcy indicates that you had a financial problem, but you are taking the necessary steps to improve your situation. When speaking to a future employer about your bankruptcy, be sure to heed the following:

  • Be honest: explain the circumstances that led to the bankruptcy and the changes that you have made to your personal finances. Use this as an opportunity to illustrate you are taking care of past problems.
  • Have recommendations: if you feel that your bankruptcy tarnishes your resume, augment it with letters of recommendation from trusted coworkers and previous supervisors. A glowing letter of recommendation from a reputable source will make your resume stand out from the rest.
  • Be aware of your rights: if you suspect that a potential employer ran a credit check on your past finances without your permission and said the credit check was a defining factor in not getting the job, then it may be time obtain a legal opinion regarding the situation.

Note that most credit checks are simply a part of a complete background check by employers. Those checks can include financial and criminal histories. As long as your criminal record is clean, your credit score should not have much of a bearing on your future employment unless the job you are applying for is in the financial industry. Finally, remember that prior to bankruptcy, your credit score was likely very low if you had missed payments and defaulted on loans. Filing bankruptcy offers you the opportunity to improve it over time. Often, if finances are handled successfully after a bankruptcy filing, credits scores are back to where they were prior to the filing or better within a couple years.

If you are applying to a governmental job at any level, your prospective employer is not permitted to factor in your bankruptcy when deciding on your aptitude for a position per federal law.

I am Considering Filing for Bankruptcy and Need Advice

If bankruptcy seems like the most logical option to deal with your finances, consult with an experienced bankruptcy attorney to guide you through the process. The experienced counsel of a bankruptcy lawyer will ensure that you go about the process in such a way that it has little to no effect on future employment. The Kansas City-based Sader Law Firm has over 30 years of experience guiding individuals and businesses through Chapter 7, Chapter 11 and Chapter 13 bankruptcies. We understand that bankruptcy can be a difficult decision for some, but we have the expertise and the resources to make the process as easy as possible. For more information about how we can help in your particular circumstance, reach out to us today; we would love to speak with you.