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Bankruptcy and Your Employer

What Can Your Employer Find Out About Your Bankruptcy?

It is common for someone filing for bankruptcy to be concerned about the affect on their current employer. An employer normally would never know that one of their employees has filed for bankruptcy unless they have some type of regular credit background check that gets updated periodically. There is no pro-active notice to your employer that informs them of a bankruptcy filing. Some financial firms or other firms where employees are working with sensitive financial data may be very interested in your credit background. Usually, these firms will ask for an authorization to run your credit background before you get hired. You can always go to your Human Resources department and ask them confidentially if your employment can be affected by a bankruptcy filing. You will not be doing any harm to your employment status by asking a theoretical question.

What is more important to watch out for is wage garnishment activity from one of your creditors. If one of your creditors takes you to court and gets a judgement against you, they can start garnishing wages that come from your employer. For your creditor to execute a wage garnishment, they will need to organize with the sheriff’s department and with your current employer to make the wage garnishment happen. If they do move forward with a wage garnishment, your employer will definitely be notified of your financial problems because the creditor will require the employer’s cooperation to execute the garnishment. If they have to continue to support wage garnishment activities, the cost of the resources committed to helping the sheriff’s department organize the wage garnishment may come into question. Some employers have policies that allow them to end relationships with employees that have wage garnishments to manage.

Bankruptcy can stop all wage garnishment and activities caused by judgements from creditors. Bankruptcy Law Professionals’ Orange County bankruptcy attorneys and Riverside bankruptcy attorneys have extensive experience dealing with creditors suing debtors and we regularly stop collections activities like wage garnishments for our clients.

If you are interested in setting up a consultation with Bankruptcy Law Professionals, we can be reached at 855 257-7671.

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