Bankruptcy Records

Are Bankruptcy Records Public Information?

Yes, bankruptcy records are publicly available unless sealed or expunged by the court. As per 11 U.S.C. § 107, interested persons can examine and obtain copies of bankruptcy records, including dockets and all papers filed in the bankruptcy case. However, identifying details and other information that may put an individual at risk of personal injury, identity theft, or unlawful injury to the property are protected from disclosure by the bankruptcy court. Examples of these details include:

• Bank account numbers
• Complete Social Security numbers
• Full birth dates
• Complete tax identification numbers
• Names of minors involved in the case
• Private contact details

In some cases, the bankruptcy court may seal or destroy the entire bankruptcy record if the judge finds that public availability may threaten an individual’s safety. However, interested persons have to file a petition and explain how the entire file presents a threat and how "the need to seal records" outweighs the public’s right to access the document. If the court determines that sealing is unnecessary, it may simply redact sensitive information instead of placing the record under seal. Public bankruptcy records are accessible by phone, in person at court depositories, and online.

Record seekers looking for an alternative to government sources may obtain bankruptcy records from third-party websites. These non-governmental websites often come with tools that help simplify the search for single or multiple records. However, record availability on third-party sites tends to vary because they’re independent of government sources. To obtain bankruptcy case information using third-party sites, record seekers may need to provide:

• A complete name of the debtor involved in the record
• A bankruptcy case number

What Are Bankruptcy Records?

Bankruptcy records are court documents, materials, and files that contain information on bankruptcy cases and proceedings that take place in a Federal Court. When debtors file for bankruptcy, the court requires them to submit a bankruptcy petition along with certificates, schedules of assets, liabilities, income, expenses, and statements of financial affairs. Depending on the type of bankruptcy filed, the debtor may also file a reorganization or repayment plan.

The information contained in a bankruptcy record may include the filer’s details, the debtor's financial details, and other public information provided to the court or recorded during the bankruptcy process. Since bankruptcy proceedings are also court cases, bankruptcy records are subject to court rules, public record laws, and expungement laws.

According to a report by the Administrative Office of the U.S. Courts, the U.S recorded a 38.1% fall in bankruptcy filings between March 31st, 2020, and March 31st, 2021. Filings fell from 764,282 cases recorded in the previous recording period to 473,349 cases filed as of March 2021. Business filings fell by 13.9%, while non-business filings fell by 38.8%.

What Do Bankruptcy Records Contain?

Bankruptcy records may contain:

• Case number and filing date
• Type of bankruptcy filed (Chapter 7, Chapter 13, Chapter 11, etc.)
• Voluntary or involuntary filing
• Debtor’s name, address, and last four digits of SSN
• List of creditors and principal parties, including addresses and amount owed
• Court Name
• Assigned trustee’s name
• Assigned judge’s name
• Attorney or legal representative details
• Assets
• 341 meeting details (if any)
• Case status
• Case disposition
• Type of discharge and objections for discharge (if any)
• Discharge and closing dates
• List of all documents in the case such as trustee’s report, credit counseling certificates, statements, or plans

The amount of information contained in a bankruptcy record may depend on the means of obtaining the information. For instance, case information gotten by phone may not be as detailed as paper copies obtained from the court clerk.

What Are U.S. Bankruptcy Courts?

U.S. bankruptcy courts are federal courts in the United States that are especially created to handle bankruptcy cases in compliance with the Bankruptcy Reform Act. The bankruptcy proceedings are authorized by the U.S. Bankruptcy Code and governed by both federal rules of bankruptcy procedure and local bankruptcy rules created by the state. The U.S is home to 90 bankruptcy courts. Most states have at least one U.S. bankruptcy court to handle all types of bankruptcy cases filed by residents or persons who have a majority of their assets in the state. However, bankruptcy cases in the U.S. Virgin Islands, Northern Mariana Islands, and the District of Guam are heard by a visiting bankruptcy judge or a district court judge. Moreover, the Western and Eastern Districts of Arkansas share one bankruptcy court.

Note: State courts cannot preside over bankruptcy cases

How Do I Get Bankruptcy Records?

Interested persons can access bankruptcy records in the following ways:

• From the Clerk Office or divisional office
• Through the Public Access to Court Electronic Records (PACER)
• Via Voice Case Information System (VCIS)
• From the National Archive and Records Administration (NARA)

Obtaining bankruptcy records from the Clerk Office or divisional office:

Certified and informational copies of bankruptcy records may be available at the Clerk Office of the court that heard the specific case. Interested persons may make requests in person or mail request letters containing a description of the needed documents with adequate case details like the case number, docket number, filing date, and party's name. Persons may send the requests to the appropriate clerk or divisional office. Furthermore, individuals may view bankruptcy case information for free in any Bankruptcy Court divisional office through the public access terminal.

Obtaining bankruptcy records through the Public Access to Court Electronic Records (PACER):

PACER is a web-based record system that provides public access to federal court records. Individuals can get online access to bankruptcy case records and docket information by registering an account, conducting online case searches, and downloading documents (fees apply). Users have to know the court where the bankruptcy case was filed to search for court records and provide information such as Employer Identification Number (EIN), Social Security Number (SSN), or Tax Identification number to conduct a bankruptcy search. For a case or party search, users may provide details like the case number, case title, filing date, party name, and other related information.

Obtaining bankruptcy records Via Voice Case Information System (VCIS):

The Voice Case Information System is an automated voice response technology that allows people to navigate court records from their phones and reads case information from the court’s computer. Interested persons can dial the 24-hour toll-free number at (866) 222-8029 to explore bankruptcy court documents and listen to an automated list of cases. Users have to enter specific case information like the case number, SSN/ITIN, or party name to obtain case information.

Obtaining bankruptcy records from the National Archive and Records Administration (NARA):

Records of closed bankruptcy cases may be available at the National Archives and Records Administration. Interested persons can order copies of bankruptcy case files online by:

1. Visiting the Order Reproduction page
2. Selecting court records
3. Selecting bankruptcy cases
4. Choosing item to order (docket, pre-selected document, or entire case file)
5. Providing required order information, such as court location (state and city), case number, debtor name(s), transfer number, etc.
6. Paying fees (the record is shipped after three to ten working days)

Persons may also order copies of bankruptcy records from the National Archives via mail, fax, or email by downloading, completing, and sending the bankruptcy record request form to the appropriate address (fees apply).

Where to Conduct a Free Bankruptcy Case Search

Since bankruptcies are typically handled by federal courts, persons looking for where to conduct a free bankruptcy case search may contact the bankruptcy court that heard the case. Federal courts typically provide a few free options for accessing case information, including:

• Public access computers/terminals at the U.S. bankruptcy courthouses
• The automated Voice Case Information System (VCIS) at (866) 222-8029 (toll-free)

Record seekers may also obtain bankruptcy records from third-party websites. These non-governmental websites often come with tools that help simplify the search for single or multiple records. However, record availability on third-party sites tends to vary because they’re independent of government sources. To obtain bankruptcy case information using third-party sites, record seekers may need to provide:

• A complete name of the debtor involved in the record
• A bankruptcy case number

How Do I Find Out if My Bankruptcy Case Is Closed?

If the filer does not have an attorney, filers will receive a notice from the court on the bankruptcy case closing order via mail. Otherwise, the court will send the mail to the attorney, and interested parties may obtain the information from the attorney, court clerk, or online. Record seekers should note that getting a discharge does not mean that the case is closed. Bankruptcy cases may take some time to close after discharge, depending on the debtor’s property situation, trustee’s ongoing actions, and other complications that may hinder the court from closing the case. Usually, no-asset Chapter 7 cases close quickly. However, bankruptcy may take longer if;

• The trustee is still selling assets or distributing assets
• Creditors contest the discharge
• Debtor fails to comply with court procedures
• Revoked discharge due to fraud, failure to disclose all assets, misstatements, or failure to comply with a court order
• There is outstanding litigation.

Note: A court may reopen a bankruptcy case if the court discovers an unlisted asset, creditor violates a discharge, or the debtor forgot to list a debt.

Can Bankruptcy Records Be Expunged?

On rare occasions, a court may expunge bankruptcy records. In line with 11 U.S.C. § 105, the bankruptcy court has the power to order the removal or destruction of bankruptcy case records, as deemed necessary, in line with the law and court rules. Moreover, the court may order a bankruptcy record to be expunged to protect confidential research, trade secrets, development, or commercial information.

The court also protects individuals from potentially injurious information by removing certain material like means of identification and scandalous or defamatory information contained in a bankruptcy case file from public access, in accordance with 11 U.S.C. § 107. Interested persons may want to file a motion for expungement records at the court where bankruptcy proceedings took place.

What is the Downside of Filing for Bankruptcy?

There are several disadvantages to filing for bankruptcy. Although the bankruptcy system provides respite to persons with heavy debt, interested petitioners should be mindful of the following downsides.

1. Reduced Credit Score: Filing for bankruptcy leaves lasting damage on the petitioner's credit score. In addition, the bankruptcy application stays on the debtor's credit report for several years. Under the Fair Credit Reporting Act, Chapter 13 bankruptcy remains on the applicant's credit report for seven years, and up to ten years for Chapter 7 bankruptcy.
2. Employment and Tenancy Difficulty: Persons who have filed for bankruptcy often encounter problems with job applications or rent. Certain employers may conduct background checks on prospective employees and also obtain the person's credit report. In some cases, employers may deny job access to applicants with poor credit scores. Landlords may also reject tenancy applications from debtors with low credit scores or persons with a bankruptcy on their credit reports.
3. Non-Dischargeable Debt: Petitioners must note that the bankruptcy system does not resolve all debts. Regardless of the type of bankruptcy filed, applicants must continue to satisfy the requirements for non-dischargeable debts. Examples include child support, criminal fines, and alimony. Student loans are also non-dischargeable unless the applicant can prove undue hardship.
4. Loss of Assets and Property: Persons who file for Chapter 7 bankruptcy may lose their assets to the process. Since this type of bankruptcy involves asset liquidation, petitioners may only maintain ownership of the non-exempt property to the degree stipulated by the law in each case.
5. Poor Access to Financial Aid: Loan services interpret a bankruptcy filing or poor credit score as a representation of the applicant's financial habit. Such persons may find it difficult to obtain financial aid from these companies in many cases. Credit card companies may also refuse to issue cards to such persons and could cancel cards already issued.

What is Chapter 11 Bankruptcy?

Chapter 11 bankruptcy resolves debt by allowing the applicant to create a reorganization or restructuring plan. Many businesses, partnerships, and corporate entities use Chapter 11 because it allows them to handle debts without shutting down their operations. However, some qualifying individuals, such as celebrities, may use Chapter 11, especially when they do not meet the requirements for other types of bankruptcy. The debtor must establish a repayment plan and submit the same to creditors and the court. Specifics of the repayment plan, including duration and monthly payment, largely depend on the creditors' approval. After creditors pass their votes, the court must then consent before the plan starts.

Each debtor must provide:

• A list of all assets and liabilities.
• A statement of the debtor's financial affairs.
• Evidence of the debtor's income and expenditure.
• Unexpired leases and executory contracts

The duration of a Chapter 11 bankruptcy case usually varies. Depending on specifics, Chapter 11 bankruptcy may last up to two years or may be completed in months. Factors that influence duration include the number of creditors, debt nature, creditors' approval of the repayment plan, and the court's consent.

Chapter 11 bankruptcy costs filing and miscellaneous administrative fees of $1,167 and $571, respectively. The court allows debtors to pay these fees in installments, with the last payment completed 120 days after the application. If the debtor provides good cause, the court may extend the deadline to 180 days.

What is Chapter 7 Bankruptcy?

Bankruptcy under Chapter 7 settles debt by liquidating the applicant's assets and properties. After the sale, the court keeps a percentage of the proceeds for the assigned trustee and pays creditors with the rest. Chapter 7 bankruptcy is unavailable where the applicant has made a previous filing in the last eight years.

Also known as liquidation bankruptcy, Chapter 7 bankruptcy may be completed in a few months. Since there is no repayment plan, the court may approve the application, sell all non-exempt assets, and resolve the case within six months. However, like other types of bankruptcy, debtors must continue to pay alimony, child support, student loans, and criminal fines. A Chapter 7 bankruptcy filing stays on the applicant's report for ten years after the filing date.

In most cases, Chapter 7 bankruptcy applicants can discharge the following debts:

• Mortgage loans
• Medical bills
• Income tax debt
• Personal loans
• Car loans
• Student loans - proof of undue hardship is required
• Credit card debt

Approval for Chapter 7 bankruptcy requires a means test to determine that the application is not an abuse of the bankruptcy system. The court must appraise the applicant's financials, including income, expenditure, secured debt, and unsecured debt.

The means test compares the applicant's household income to their state's median income. Persons with income lower than their state's median are likely to qualify. Other persons may also be eligible if the court considers other case specifics. Apart from income comparison, the means test also decides whether or not the applicant can repay their debt after deducting certain expenses. These may include groceries, rent, clothing, and medical expenses.

Regardless of the preferred type, bankruptcy law prevents debtors from applying within 180 days of a previous discharge if any of the following applies:

• The debtor violated a court order
• The debtor requested a dismissal following a creditor's request to stop the automatic stay
• The court dismissed the case after concluding that the application sought to exploit the bankruptcy system, or was otherwise dubious

What is Chapter 13 Bankruptcy?

Like Chapter 11 bankruptcy, the Chapter 13 process also handles debt through a repayment plan. This type of bankruptcy requires the debtor to create and follow a plan, subject to the approval of creditors and the court. However, the Chapter 13 bankruptcy is only accessible to debtors who earn salaries or have a regular income. Chapter 13 bankruptcy is also called the wage earner's plan and does not require repeated contact between debtors and creditors.

Federal bankruptcy law specifies that no Chapter 13 repayment plan may be longer than five years. The court may approve a five-year plan if the debtor's income is higher than the state's median, or three years for debtors with lower income.

As of 2021, Chapter 13 bankruptcy eligibility debt limits are $1,257,850 and $419,275, for secured and unsecured debt, respectively. Applicants with higher debts must consider other types of bankruptcy.

What is the Difference Between Chapter 7 and Chapter 13 Bankruptcy?

The Chapter 7 and Chapter 13 bankruptcy processes have several fundamental differences. Firstly, the two types of bankruptcy have different methods of discharging debts. Chapter 7 bankruptcy requires the debtor to turn over all non-exempt assets and properties to the assigned trustee. The court handles Chapter 7 bankruptcy by overseeing the liquidation of these assets and using proceeds to repay creditors. On the other hand, Chapter 13 does not involve liquidation. Instead, the debtor must create a repayment plan subject to the approval of creditors and the court. The repayment plan allows the debtor to make periodic payments over an agreed period.

Another significant difference between both types of bankruptcy is the discharge period. Chapter 7 bankruptcy is the fastest type because the court can sell the debtor's assets and repay creditors in a few months. However, Chapter 13 bankruptcy requires more time because of the repayment plan. Resolving a Chapter 13 case may take up to five years.

Eligibility requirements for each type also differ. Federal bankruptcy law sets a hard debt limit for eligibility under Chapter 13. Persons with debts higher than the limit for secured and unsecured debt may not qualify for Chapter 13 bankruptcy. However, Chapter 7 requires a mean test to calculate the debtor's income and compares it with their state's median. Eligibility is easier for a debtor who earns less than their state's median income.

What are Bankruptcy Exemptions?

Bankruptcy exemptions prevent debtors from losing all their assets to the bankruptcy process. These exemptions help the debtor maintain ownership of all or certain parts of specific assets required to maintain a basic standard of living.

Bankruptcy law provides several federal exemptions. However, states also offer varying exemptions to resident petitioners. Regardless, the requirements for applying these exemptions may differ between states. For instance, many states allow debtors to choose between federal and state exemptions but disallow a combination of both. Petitioners in states like Kentucky, New York, and New Hampshire may abandon federal exemptions in favor of state options and vice versa. However, states like California, Louisiana, and Colorado do not recognize federal exemptions.

Every three years, the amounts allowed under federal exemptions are adjusted due to changes in the Consumer Price Index. As of April 1, 2019, the following federal exemptions and amounts apply:

Homestead Exemption

Under federal law, a debtor can protect up to $25,150 of equity in their principal place of residence. The residential property may be a house, another type of dwelling, or personal residential property, such as a residential trailer. The homestead exemption only applies if the debtor lives on the property. This exemption is not usable on rental properties or other related investments.

Wildcard Exemption

This exemption is available to any property the debtor owns, up to a $1,325 limit. However, debtors can add up to $12,575 of any unused part of the homestead portion.

Personal Property Exemptions

The personal property exemption covers non-real estate properties owned by the debtor. Federal law specifies applicable properties and limits for each one. These include:

• Jewelry worth $1,700
• One motor vehicle worth $4,000
• Tools of trade (such as books and related equipment) worth $2,525
• Household goods, appliances, books, crops, animals, and musical instruments, to a $625 limit per individual item. However, the debtor cannot claim more than $13,400 in the aggregate value of these items
• Loans, life insurance policies, and accrued dividends to an aggregate value of $13,400
• Health aids prescribed by a professional and used by the debtor or a dependent

Benefit and Support Exemptions

Debtors may protect payments received as support or other types of benefits. The following benefits apply:

• Disability, veteran's, unemployment, public assistance, and social security benefits
• Life insurance payments where the debtor is the insured party's dependent
• Alimony or other related types of maintenance considered necessary to support the debtor

Injury Recovery Exemptions

This includes personal injury recovery payments up to $25,150, excluding pain and suffering or other compensation for pecuniary loss. Others include crime victim compensation, wrongful death payments, and compensation for the loss of future earnings.

Retirement Account Exemptions

Debtors can exempt all retirement accounts that are exempt from taxation. This includes all IRAs and Roth IRAs to a $1,362,800 limit.

What are the Other Types of Bankruptcy in the U.S.?

While most bankruptcy filings are under Chapter 11, Chapter 7, and Chapter 13, federal bankruptcy law provides other options with peculiarities for eligibility and debt discharge. Debtors may consider Chapter 9, Chapter 12, and Chapter 15 bankruptcy.

What is Chapter 9 Bankruptcy?

Chapter 9 bankruptcy is also called municipality reorganization as it caters to municipalities, including counties, cities, towns, and school districts. Like Chapters 11 and 13, Chapter 9 bankruptcy provides relief through a repayment plan.

Bankruptcy law limits the court's power in a Chapter 9 proceeding. Unless the debtor consents, the court cannot interfere with the municipality's governmental powers, political powers, revenue, or property. This provision ensures that the court does not hinder the municipality's affairs, including its functions and those of its elected officials. Bankruptcy law also stipulates the following requirements for Chapter 9.

• The municipality must be authorized to file for Chapter 9 bankruptcy under state law. The authorization may also come from a governmental organization or an officer empowered by state law to provide such approval
• The municipality must be insolvent, according to 11 U.S.C. § 101(32)(C)
• The municipality must be willing to create a debt adjustment plan
• The municipality must either
• Receive approval from a majority of the debtors, provide proof that a good-faith negotiation failed to obtain approval from a majority of the debtors, or provide proof that such a negotiation is impractical.

OR

• Reasonably believe that a creditor may prefer to obtain a preference

Depending on case specifics and complexity, a Chapter 9 reorganization may last a few months or a few years.

What is Chapter 12 Bankruptcy?

Chapter 12 bankruptcy is for family fishermen and family farmers who have regular annual income. Under Chapter 12, qualified debtors must propose a repayment plan to creditors, to settle debts over an agreed period. Usually, Chapter 12 bankruptcy takes between three and five years. The court may not approve a plan longer than five years.

Corporations, partnerships, couples, and individuals in the fishing or farming business may file for bankruptcy. However, federal law sets a few requirements. Firstly, the total amount of secured and unsecured debt should not be higher than $4,153,150 for a farming business, or $1,924,550 for a fishing operation. Also, 50% of the farmer's total debt must come from the business, while a fisherman may only qualify if 80% of the debt is from the business.

Corporations and partnerships applying for Chapter 12 bankruptcy must also meet certain requirements. In addition to the above limits, one family must own over 50% of all the partnership or corporation's outstanding equity or stock. Furthermore, corporations that issue publicly traded stock do not qualify.

What is Chapter 15 Bankruptcy?

The Bankruptcy Code offers Chapter 15 bankruptcy to debtors with assets and business spread across multiple countries, including the US. Introduced by the Bankruptcy Abuse Prevention and Consumer Protection Act in 2005, Chapter 15 promotes cooperation between US courts and foreign courts for the fair treatment of debtors and creditors. This type of bankruptcy also protects the value of the debtor's assets and properties and creates a better legal framework for solving cross-border insolvency. Chapter 15 also helps insolvent businesses to preserve employment and protect their investments.

In many cases, Chapter 15 bankruptcy serves as a secondary proceeding while the primary process is ongoing in the foreigner's country. Upon receiving a Chapter 15 filing, the bankruptcy court will specify the foreign proceeding as a "foreign non-main proceeding" or a "foreign main proceeding." The latter is used when most of the debtor's main interests are in the U.S. Federal law also requires the relevant bankruptcy court to cooperate with the foreign court to the maximum extent possible.

How Much Does it Cost to File Bankruptcy?

Depending on the chapter being filed, debtors can expect to spend between $300 to $1800. In addition to filing fees, attorney fees will attract an additional $1000 to $10,000 dependiing on the services required, and there may be other miscellaneous costs associated with filing for, bankruptcy such as court-mandated credit counseling or debt repayment classes which can cost $50 or more.

Different Chapters of Bankruptcy

The United States has different chapters of bankruptcy, which are categorized according to the type and amount of debt that a person has. The different chapters of bankruptcy are as follows:

Chapter 7 is the most common type of bankruptcy, and it is also known as liquidation bankruptcy. In this type of bankruptcy, the court appoints a trustee who will oversee the sale of the debtor's non-exempt assets. The proceeds from the sale will be used to pay off the creditors.

Chapter 11 is usually filed by businesses, but individuals can also file for it. In Chapter 11 bankruptcy, the debtor reorganizes their business or finances and creates a repayment plan to pay off their debts over time.

Chapter 12 is specifically for farmers and fishermen who have a regular income. In Chapter 12, the debtor creates a repayment plan to pay off their debts over time.

Chapter 13 is also known as the wage earner's bankruptcy. In Chapter 13, the debtor creates a repayment plan to pay off their debts over time, and they make payments to the trustee who then pays the creditors.

The chapter of bankruptcy an individual files for depends primarily on their financial situation. Before filing, individuals are advised to consult a bankruptcy attorney to find out which type of bankruptcy is appropriate for their situation.