If you are thinking about filing for bankruptcy, you may be concerned about discrimination after you file. Many people worry that they won’t get hired for a job, or they may get fired from their current one if they file. You may also be concerned that your driver’s license or government-issued ID may be revoked, or you may not be able to get a student loan.
The good news is, bankruptcy law protects you from discrimination in these cases. Here’s what you need to know about discrimination and bankruptcy.
Can I Be Fired or Not Hired Because I Filed for Bankruptcy?
According to the bankruptcy code, your employer may not discriminate against you for filing for bankruptcy. That means you cannot be fired just because you filed. In fact, your employer cannot fire you even if a debt that you owe to your employer is discharged during your case. This is a common issue for people who work at banks or credit unions and have loans or credit cards through their employer. Bankruptcy law protects the filer, even in such cases.
That’s not to say that you can’t be fired if your boss has other legitimate reasons for letting you go. For example, if you are not reliable or you are not doing your job, don’t expect filing for bankruptcy to protect you from being fired.
Also, the laws are unclear about whether or not an employer can refuse to hire you because you filed. And, unfortunately, it can sometimes be difficult to prove whether an employer has a legitimate reason firing or not hiring you, or if you’re being discriminated against for filing for bankruptcy.
Can My Government Issued License be Suspended if I File for Bankruptcy?
No, you cannot lose or be denied a government-issued business, driver’s, or professional license because you filed. According to bankruptcy law, the government is prohibited from denying, revoking, or suspending your driver’s license, commercial or otherwise, because you have filed for bankruptcy.
In fact, this rule also extends to other types of licenses that are issued by the government, such as a liquor license, mortgage loan license, or real estate license. However, this law does not protect you from being denied or losing your license if there is proof of fraud or some other illegal activity.
Can I Be Denied a Student Loan if I File for Bankruptcy?
No, you cannot be refused a government guaranteed student loan by a private lender or government entity solely because you filed for bankruptcy. Your college transcripts cannot be withheld, either.
Other Protections Against Discrimination After Bankruptcy
The law protects you from discrimination in other areas, as well. For example, public benefits cannot be denied or revoked because you filed, and you cannot be evicted from public housing in most cases. You cannot be turned down for a government contract, such as a construction project, just because you filed.
In addition, once any debts that you owed to the government have been discharged by your bankruptcy, any acts against you because of those debts must also be ended. So, if your driver’s license was suspended because you didn’t have the money to pay a court judgment, if that debt is discharged, you’ll be able to get your license back.
Remember, you can still be denied a job, loan, or apartment based on your credit, as long as it’s not related to the bankruptcy. But, filing for bankruptcy does not automatically mean that you won’t be able to get a student loan, keep our job, or get a government-issued license.
If fear of discrimination has been holding you back from getting your debt under control, call us now. The sooner you act, the sooner you will get relief!