home loan finance blog
If you need to know if someone has filed bankruptcy in their life, then you have come to the right place. A bankruptcy record will tell you who filed for bankruptcy, why and when it happened.
First off all, who should check a bankruptcy record? If you are lending money to someone, then check it. It doesnt matter if it is a friend of a friend or your child, a bankruptcy record will show you if this person is capable of returning a loan. Now, do be careful when reading a bankruptcy record. If the person filed for bankruptcy because of student loans, then you want to overlook something like that. Student loans typically come with very interest rates and very few people pay them off quickly. Most people will spend half their lives paying these loans off, while others give up and file for bankruptcy.
Why did the person file for bankruptcy? Was it student loans that did it like stated above? Was it a failed business? Was the person just bad with their money? These are very important questions that must be answered. Also, make sure that the record matched with the person. For example, if the person is a salesman and your record shows that they filed for Chapter 12, then you probably found the wrong record. Chapter 12 is for fisherman and farmers, not salesmen or regular people.
Also, when did this person file for bankruptcy? If they filed 35 years ago, then its probably safe to lend this person money or lease out a home to them. It was a mistake that happened a long time ago and theyve changed. Move on.
They have. On the other hand, if a person filed only a year ago, then they are a huge risk to you and your money or property.
What kinds of bankruptcy are there?
Chapter 7 – basic liquidation for individuals and businesses
Chapter 9 – municipal bankruptcy
Chapter 11 – rehabilitation or reorganization, used primarily by business debtors, but sometimes by individuals with substantial debts and assets
Chapter 12 – rehabilitation for family farmers and fishermen
Chapter 13 – rehabilitation with a payment plan for individuals with a regular source of income
Chapter 15 – ancillary and other international cases
Chapter 11 is the most common for businesses, while Chapter 7 is most common individuals.
Now that you know a little bit about bankruptcy, searching for that bankruptcy record should be easier than ever!