Final Secret Holder considering Bankruptcy

Hello all, first time poster here.

As the title states I am a current Secret Clearance holder and I am looking to file for Chapter 7 bankruptcy. I am not delinquent in any accounts but I am drowning in payments that I could barely afford to buy groceries and any essentials.

I talked to my FSO about considering it for some guidance as fear for me losing my job is my top concern at the moment and she told me that it’s all on a case by case basis, but informed me that I might have to redo my SF-86 even though I currently have my final clearance. Is this true?

I am currently 20k in debt that I’m looking to discharge.

Am I worrying too much? Can anyone give me some advice please maybe some personal experiences

Thank you

Cant offer any advice but you are doing the right thing by informing the FSO right away.

It may seem like a lot to you but in the grand scheme of things, $20K is not really that much. I’ve heard of people with well over $100K in debt, one guy had about $400K he owed. I think some of that came from a failed small business.

Outside of the clearance issue, hope you get some good financial (and legal) advice. I’ve heard of folks who got lured into shady deals which made a lot of money for the “credit counselor” but left the individual holding the bag. They had to pay a ton of money and their credit was still ruined.

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I’m 23 months into a chapter 13 and was granted interim for a PT position. I believe it all depends on why you got into debt to begin with. My BK was for $110k and was due to unemployment. I was also able to show that I was well into my repayment plan and that I have no new debts etc.

Some of it was for unemployment, and after it was taking out more loans/credit cards because I couldn’t afford the other cards and it caused a downward spiral, of course I had like Best Buy Cards and stuff for gifts but I have never lived an extravagant type life, I was always either underpaid and needed some help or just buying gifts for relatives (rarely).

You need top shelf financial and legal advice. If will also look better if you complete something like Dave Ramsey’s financial literacy course. In fact, Ramsey’s process will teach how to get out of debt quickly and, relatively, painlessly. In his stories, $20K is nothing.

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The old “it depends” monster raises her head here. I agree with others that 20K isn’t a lot of debt, and you may not qualify for Bankruptcy. A restructure type may be better. In the clearance world it is best to pull the handle, discharge legally than get so far behind you will do something desperate like sell classified material. There are risks, but bankruptcy in and of itself isn’t the issue it is the behavior leading up to it and following it. I agree with Ed on legal advice and not fly by night “Bankruptcy cases for $300” types. Those folks are in the churn and burn industry. They aren’t really looking deep to see if bankruptcy is best for you. Scale back on all spending to include gifts. Restructure with creditors, see what you can work out on your own if you can feed and shelter your family in the interim. Make sure this is the last recourse. But htye are very survivable clearance wise.

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