Filing For Bankruptcy for the First Time

I recently met with a potential client at my Utah bankruptcy lawyer office made clear that he had previously discussed his situation with another attorney. This did not offend me in the least, as I recommend debtors visit multiple attorneys to discuss their bankruptcy options.

However, what intrigued me about our conversation was at the end when I mentioned to the client that the more appropriate chapter for him to file would be Chapter 7, he said the other attorney he met with recommended Chapter 13. I felt that he did not have sufficient income to support a Chapter 13 repayment plan, and knew he did not have assets he would likely lose in Chapter 7, so I recommended Chapter 7.

I asked the potential bankruptcy filer why the other attorney said Chapter 13, and he said because the other lawyer told him he could not keep everything in Chapter 7. After reviewing his list of assets, I knew that was not true and a Chapter 7 filing would most likely be a no distribution case, so I asked him what assets the other attorney felt like he would lose. He said he was not sure, as he and the other attorney did not go over his list of assets.

This made no sense. Either something was lost in translation in their conversation, the other attorney did not know enough about bankruptcy law or was perhaps purposefully steering him into the wrong chapter.

Chapter 7 or 13

Whatever the reason, there simply is no way to determine whether someone belongs in Chapter 7 or 13, without knowing the following: (1) the debtors assets and equity position in those assets (2) income and ability to qualify under the means test (3) arrearage amounts on secured debts the debtor wishes to retain (i.e., home or car)(4) previous bankruptcy filings of the debtor (5) an accounting of the debtor’s secured, priority and unsecured debts. Learn how Chapter 7 bankruptcy works.

Without going over all of those in full, the attorney cannot accurately tell the debtor: (1) whether a Chapter 7 discharge is likely (3) whether the debtor can retain all property in Chapter 7 (3) what a Chapter 13 repayment plan would look like. So if you meet with an attorney who does not go over all of those with you, it’s time to get a second opinion.

Will People Know I Filed for Bankruptcy

Generally speaking, however, when we are concerned about public reputation and friends and neighbors, there is not much to be concerned about from a practical standpoint. If you are a politician or celebrity or someone whom the media has a general interest in writing about, it is a virtual certainty that a bankruptcy filing would be discovered and publicized.

But for the rest of us, even those of us with real estate or other licenses, it is fairly unlikely that anyone will bother to think to go to the PACER website, apply for and receive a user-ID and log-in password, and arbitrarily search you out. Should you file bankruptcy and should someone be motivated to do that (and know how the not-always-very-user-friendly PACER system works), they will find you. But, in most instances, people we casually or socially or even professionally know are not quite so motivated.

Further, given the state of the economy over the past ten or more years, you may be surprised to discover who among your friends and acquaintances has already availed themselves of this legitimate and legal process, the roots of origin of which date back through the US Constitution, the Magna Carta, and the Book of Deuteronomy. The “taint” of bankruptcy is not what it used to be, as I am repeatedly reminded when I receive a phone call or email from a new potential client who has been referred by one of my prior clients. Make sure to get our professional bankruptcy advice.


Once upon a time, bankruptcy clients did not offer referrals because they were too embarrassed to admit that they had undergone the process. This is no longer the case as more and more people have moved forward with the most effective form of debt-relief available under American law.

Will your friends and neighbors know if you file bankruptcy? If you tell them that you did so, yes. Otherwise, odds are against it. But, even if they discover that you have gone forward to find a fresh start for yourself and your family, the chance that they will view you with disfavor because you have done so is, in this day and age, far slimmer than it has ever been. Learn more at