# Bankrupcy - pro i contra



## cadet (26 Aug 2009)

What are the consecuenses after filing  for a bankrupcy? Will it affect Level II (secret) clearance?About TS I don't even dare to ask...

 And, if you use an alternative - like consumer proposal, for intance - will it look better for security clearance purposes?


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## Fishbone Jones (27 Aug 2009)

Are you in the military? Because unless things have changed, you won't have to worry about your security clearance. Being an admin burden of that magnitude used to get you tossed. However, perhaps things have changed, with us becoming a kinder and gentler employer. :


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## Roy Harding (27 Aug 2009)

According to your posting history - you've been in, and posted to Cold Lake for two years.  How the hell did you go bankrupt?  Obviously not by spending money on remedial spelling courses.  And why don't you already have a Security Clearance?

There's more to this story (and _story_ is what I suspect either it, or your posting history is) ...


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## SupersonicMax (27 Aug 2009)

I can see how someone can go bankrupt in Cold Lake, with the price of houses, if someone isn't careful. Banks will approve you right up to a 40% debt percentage (after taxes, that doens't leave much to... live)

I believe (although not sure) the OP was asking about an existing Security Clearance.


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## Roy Harding (27 Aug 2009)

SupersonicMax said:
			
		

> I can see how someone can go bankrupt in Cold Lake, with the price of houses, if someone isn't careful. Banks will approve you right up to a 40% debt percentage (after taxes, that doens't leave much to... live)
> 
> I believe (although not sure) the OP was asking about an existing Security Clearance.



I know all about being house poor - been there.  But I didn't go bankrupt over it.

I see your point regarding an existing Clearance - although I'm not sure either.


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## SupersonicMax (27 Aug 2009)

Roy Harding said:
			
		

> I know all about being house poor - been there.  But I didn't go bankrupt over it.



That's why I said "if someone isn't careful"


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## gunshy (28 Aug 2009)

> How the hell did you go bankrupt?  Obviously not by spending money on remedial spelling courses.



 :rofl: ROY!


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## dale622 (31 Aug 2009)

No use in attacking the guy for having a problem. I don't know about the effect it would have on security clearance but I know a few people that have declared bankruptcy and were not kicked out. Yes they do look at you credit history when you apply for security clearance and when you are joining or switching trades. As far as I know if you declare a proposal they will not contact your boss and have them run after you. Unless your only phone number is through the OR  . The way I look at it is, if you are in that much trouble that you are thinking of filing then your credit is messed anyways. I know a friend of mine who defaulted on a loan and lost his job. He was starting his new trade just as collections was threatening court actions against him. The two things that worked for him was a proposal or have someone else take out a secure line of credit for him to buy the debt from the collector. Thus continuing payments as soon as he started his new trade. 

There are of course downsides to all options. Proposals stay on your credit history for 3 years after your debt is paid. That being said.... with a proposal they will halve your debt and give you tiny payments that you MUST make (3 strikes and your out). If you miss your 3 payments then you a$$ is grass. You still reserve the right to make additional payments with no fees for paying off anything early.

The option of someone buying out your debt with their own credit is an option that could benefit both parties. The debtor (person in trouble) will be allowed to continue making regular payments without phone calls about legal action from credit collectors. The person that borrowed the money will be allowed to charge a normal interest rate and maybe make a little $ out of the deal. The best thing about the last one is it keeps everything out of the private sector and won't reach your chain of command. UNLESS you stop paying and the person that did you a favour takes you to court. In that case once again.... your a$$ is grass. 

It's alot to think about and it seems your back is against the wall. There are options and people that can help. I have had a bit of experience being on the "bad guy" side of this. If you want any more info feel free to PM me.


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