Becoming unemployed, or a cutback in hours, is one of the top reasons why many people file for bankruptcy. Being unemployed without a steady source of income is a tough situation for anyone. By law, you do not have to be employed to file for bankruptcy. However, if you are unemployed your job status can affect the outcome of your bankruptcy. Continue reading
It’s normal to worry about will filing bankruptcy affect my employment status and who will find out about my bankruptcy filing. Many individuals who are considering filing for bankruptcy also worry about the effect of the bankruptcy on future employment. They are typically concerned with if a potential employer finds out about the bankruptcy filing; will the employer be deterred from hiring you? This is especially true if you are employed in a position of trust or employed to manage others money.
For most people filing for a Chapter 7 bankruptcy, one of their biggest worries is their vehicle. If a person loses a vehicle in a bankruptcy, he or she loses a way to get to work and will then have even more financial difficulties.
If you are in Chapter 7 bankruptcy, your car lender cannot repossess your car or otherwise try to collect the debt without getting permission from the court. The reason is the automatic stay – when a Chapter 7 bankruptcy is filed, an automatic stay is created. An automatic stay makes it illegal for most creditors to attempt to collect debts.
However, your lender can ask the bankruptcy court to lift the automatic stay in order to repossess your car. In order to do this, the lender must file a “motion for relief from the automatic stay”. In the motion, the lender has to show that it’s a party to the bankruptcy as a creditor, that it has a right to repossess the car, and that its interests are not being properly protected because you are not making timely loan payments.