Many people hold off on filing for bankruptcy because they feel ashamed that they were not able to manage their debt on their own and for not being able to pay their creditors. They also worry that if they seek bankruptcy relief, the world will know that they have committed this “shameful” act, and that they will somehow be branded with a scarlet letter “B.”
First of all, I do not believe that filing for bankruptcy should be viewed as shameful or embarrassing. Now, I know that I am a bankruptcy attorney and that people will think this is a biased opinion. But, I really do believe this. We all experience tough times and sometimes it is harder to pull ourselves out of those tough times than usual. We need help, and there is nothing wrong with needing help.
Second, there is no branding involved in filing for bankruptcy. You will not have to display your bankruptcy filing to the world. Bankruptcy is a public proceeding. This means that anyone could view your bankruptcy paperwork, or petition, and learn about your case. It also means that the 341 Hearing (the one court appearance that you will have) will generally be an open proceeding with other bankruptcy filers, and their attorneys, present. However, the whole world will not know that you have filed bankruptcy. To my knowledge, the State of Arizona does not publish notice of individual bankruptcy filings in any public forum. There are publications of business bankruptcies in the newspapers. In order to access online case information, you must have an account with the US Bankruptcy Court. This not something that a simple curious bystander is probably going to obtain. Attorneys are only required to directly notify creditors and co-debtors of a bankruptcy filing. Your employer will not get direct notification unless you have an ongoing garnishment. In this case the employer must be contacted with the case information to stop the garnishment. Besides these instances, there should be no one else who would know of your filing, unless you tell them. So, despite being a matter of “public record,” it is not foreseeable that many people will ever know that you filed for bankruptcy. Therefore, if you must look to bankruptcy to help you with your debt relief, there is nothing to fear and nothing to be ashamed of.