As a bankruptcy attorney in Miami one of the most frequent objections to a recommendation of a bankruptcy is that neighbors may find out about the bankruptcy filing. The general and unsupported historical stigma of bankruptcy carries lots of weight in this day and age where it seems a keystroke of the computer may reveal one’s financial circumstances and it can be spread to the community quickly.
The truth of the matter is that bankruptcy filings can be best discerned easily by looking at someone’s credit report. However, most people do not have access to someone else’s credit worthiness and neighbors will not willingly give their consent to provide their personal information if asked. Credit reports then may not be the best way to find out. The problem is that privacy laws disallow obtaining personal bankruptcy and financial information unless the person or company soliciting it has a permissible purpose under the law. In other words, there is a commercially reasonable need to know the financial information. A business relationship qualifies as a permissible purpose and most neighbors may not even have a friendly personal one at that.
So how can the nosy neighbor find out? Well, it seems that there is a tried and true way, which is the public’s right to information to federal bankruptcy documents. Bankruptcy laws are federal and therefore, the bankruptcy records are retrievable. It is called the PACER website and it is little known resource for bankruptcy information except to those outside financial institutions, credit worthiness professionals and bankruptcy practitioners. It is a public access website that provides information about how the federal government electronically records federal court records.
What information is in the PACER docket? All of the financial information submitted in a bankruptcy filing is accessible unless disallowed by the bankruptcy court. It s a mobile friendly designed website that at the touch of your mobile phone, I-pad or computer, provides court-specific information. Your neighbor can find out where you work, how much you make, who you owe money to, and if you are behind on your mortgage or car payment. They can also find out what you own and what you rent or lease.
Fortunately, for most worried about their neighbor’s ability to search for a bankruptcy filing, most people do not know about the PACER website. Those who do, may lose motivation after finding out that one has to register for the website and make payment for every page that is downloaded. It is a pay website. Regardless, debt relief is ultimately more important to a person in financial distress than thinking about what a neighbor knows about their personal finances. The filing of a bankruptcy therefore, should never be based on the likelihood or not that your neighbor knows your financial business. For those curious neighbors, there is always the PACER website.