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Ellen
Ellen, Attorney
Category: Bankruptcy Law
Satisfied Customers: 36714
Experience:  Bankruptcy Lawyer. Experienced.
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I am on the verge of having to file for bankruptcy due to medical

Resolved Question:

I am on the verge of having to file for bankruptcy due to medical bills. I have MS and went through a bad spell in 2007 when I had no insurance. I am over $20K in debt which are now in collections. Over 20 collection accounts in all. My question is this: When applying for jobs, will a potential employer see the fact that I filed as a red flag an not hire me, or in his/her eyes, is have this much debt in collections worse then bankruptcy? Would settling my debt for less then what I own be better then bankruptcy in the eyes of an employer? I would like to continue my schooling and would like to work as a cashier or waitress for a store like Target, Wallgreens, CVS, Rite Aid, Walmart, etc. How bad would filing for bankruptcy really be in terms of me landing a job?
Submitted: 5 years ago.
Category: Bankruptcy Law
Expert:  Ellen replied 5 years ago.

WebLaw :

*This chat is not intended as legal advice. It is general information that may or may not apply to your situation and should not be relied upon.*

WebLaw :

Welcome to JustAnswer,

So sorry to hear of this dilemma. If my answer is not clear to you or does not fully answer your question, please ask me for clarification by using the reply button.

WebLaw :

Typically it would be more favorable to obtain a discharge of outstanding debts through bankruptcy. An employer may discriminate against an employee on the basis of financial instability but may not discriminate on the basis of having filed bankruptcy. Therefore the employer may lawfully discriminate against you if you work out a payment plan but may not if you file bankruptcy.

WebLaw :

Here is the language of the Bankruptcy Code "No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title … solely because such debtor … is or has been a debtor under this title…." 11 U.S.C. sec. 525(b).

WebLaw :


I think this is what you wanted to know. Please use the REPLY button if you have any questions concerning my answer. Otherwise please click ACCEPT so that I am paid by the site for answering.

Customer:

So, in your eyes, it would be better to file as oppose to try to settle my debt for less then what I owe? If/when an employer pulls my report, would they be able to see a 100-word statement that I am legally allowed to add to my credit reports? I would like to mention that the bankruptcy was due to excess medical bills while uninsured and not because of bad spending habits. In your experience, how hard is it for a person who has just filed to land a new job? Is getting a waitress or simple cashier job out of the question? Thank you :)

WebLaw :

I apologize for the delay – I was taking a short break when you responded

WebLaw :

So, in your eyes, it would be better to file as oppose to try to settle my debt for less then what I owe? CORRECT If/when an employer pulls my report, would they be able to see a 100-word statement that I am legally allowed to add to my credit reports?CORRECT I would like to mention that the bankruptcy was due to excess medical bills while uninsured and not because of bad spending habits. In your experience, how hard is it for a person who has just filed to land a new job? NOT HARD AT ALL Is getting a waitress or simple cashier job out of the question? THEY SHOULD NOT BE A PROBLEM Thank you :)

WebLaw :

It has been my pleasure to work with you

Thank you in advance for remembering to click accept. If you experience difficulty using the accept button, please let me know as JustAnswer pays me for my time only if the "accept" registers..

Please let me know if I can assist you in the future by requesting me directly.

WebLaw :

Please accept and then feel free to ask me another question on a new page - if you're a subscriber, you can do so at no additional cost beyond your monthly payment. Start your new question with "for WebLaw" so that the question is directed to me and I can give your question my immediate attention

Thank you very much,
WebLaw

Customer:

Why would settling my debt for less that what I owe be worse then bankruptcy?

WebLaw :

Because you would not have the protection of the antidiscrimination clause that the bankruptcy code provides

Customer:

But if that says on my record for 10 years, would I not be able to increase my score much faster if I settled? Also, could not an employer still see the bad credit that preceded the bankruptcy and discriminate using that?

WebLaw :

Yes it will stay on your record for 10 years. The employer cannot discriminate on the basis of the debt that was included in the bankruptcy. This is my opinion based upon my experience. However the choice is yours

WebLaw :

Please accept and then feel free to ask me another question on a new page - if you're a subscriber, you can do so at no additional cost beyond your monthly payment. Start your new question with "for WebLaw" so that the question is directed to me and I can give your question my immediate attention

Thank you very much,
WebLaw

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