Bankruptcy
 

Hi Lori,

Here is my situation, I currently work for an airline (non pilot position)and I am on the upcoming furlough list. I was hired at a regional (for a pilot position)during the last hiring boom, (april 2008) but my class was cancelled and now im trying to obtain some more cfi ratings under my belt..

Financially I am having difficulty. I have talked to several debt counselors and debt management companies, including a bankruptcy attorney. If I were to file for a personal bankruptcy will this affect me in the future getting hired when the airlines start picking up? Is this something the airlines check when doing a background check?? I want to avoid bankruptcy by all means, but its looking like thats what I may have to do...Any advice would be greatly appreciated.

Thanks

Aaron

you not alone.....we have been having the same discussion this week

You'll be fine. If you have to file, file. Airlines want to see you taking care of your responsibilities. You are showing them that you have/are, a good thing.

Also, unless you are planning to work around large sums of money, you have nothing to fear. All the Best!!!

I would disagree with this. Airlines have always had a higher standard of personal responsibility for pilot candidates compared to other jobs. Historically they have always been interested in bankruptcies, and would probably disqualify you for having one. Filing BK is not exactly "taking care of your responsibilities"...it is getting out of them. Doesn't matter if you think it's fair or not, it is legal to consider an candidate's BK record and they can and will do it.

The good news: The situation with the economy means you are not alone, and may not be the only applicant with a recent bankruptcy.

The bad news:

- When hiring resumes there will be a backlog of candidates, and they will be picky. I would assume they will have plenty of candidates without a bankruptcy.

- The colgan crash has focused a spotlight on regionals, they will probably all elevate their standards across the board in a knee-jerk reaction. You might see some companies instituting formal hiring rules rather than relying on the interviewer/hiring board to balance all the facts.

Bottom line: If you want to fly, try to avoid bankruptcy at all costs. Even if your discretionary income goes to zero and you cannot afford to have any fun for a few years.

If you have to file, your defense at an interview would have to be economic factors beyond your control. Hopefully they will be willing to take a look at your pre-BK finances (have a spreadsheet to show that you were not spending irresponsibly).

As I have said before, I dont want to file, but having seen an attorney, and have talked with several debt counselors, and financial advisors, it may be my only option..

the problem im having is that a debt management program(when all bills are consolidated into 1 pymnt) will not work for me, that will be 950 dollars a month, not including gas, food, student loans, rent, utilities, etc...the problem is I dont make enough money at work, cant pick up overtime, and soon to be furloughed..I have nothing else to cut, dont have a second vehicle to sell, land, or own a home...

Debt reduction on the other hand is a scam, they want me to pay over 6,000 in legal fees, put money into an escrow account in which the first several months you pay the company's fees, and yet the bills are not getting paid, a negative mark on your credit, and this stays on your record for 7yrs, and what they dont mention is that you have to file on your next taxes the exempt amount..oh yeah the pymnt for this a month is around 700dollars a month for 3yrs...again cant afford that...

this whole scenario dosent even touch student loans, and they wont be exempt in a BK..

so thats my situation...

If there's no way out, then there's no way out.

I have to ask though...as an entry-level pilot how do you have $1000/month in loans in ADDITION to student loans?

You could always get a non-flying job that actually pays a decent wage until you can afford to be a pilot again. Throwing boxes for UPS while doing something else during the day will pay a lot more than whatever pilot job you are about to lose pays.

You don't always get to do the job you want. You took on all the debt, you are responsible for paying your bills. You probably won't be totally screwed because personal responsibility is out of vogue in our country right now, but don't act like you really have only the options you listed.

As I have said before, I do NOT want to declare Bankruptcy...yes I took on that debt, but 2 creditors also raised my interest rates to 30%, and Im about to lose my job after 10yrs...i have already started applying for various jobs, as unemployment wont cover the bills, still no leads, tried fedex, and ups, no bites yet..hopefully i can work hard for at least a year and pay off some of my debt, even if i work 2jobs..thats the plan for right now, BK is an option though, and i was just wondering if it would have an affect on getting hired..

Pilot Dude,

Listen, the only one that could answer that question would be the perspective company that you are trying to hire on with.

My perspective on this is that there are not many airlines or for that matter industries that have not followed this path too.

If you could take anything from all of this advice, run from a career in aviation! Run as if "monsters" were chasing you. Pick a career where there is a demand no matter how the economy is. Medical Field is an excellent choice.

Whatever you decide, I wish you the best

Whale

I got hired with a Bankruptcy, and horrible credit. Do it if you have to, its not as bad as everyone thinks. I was getting offers for credit card less than a year later, started with a $500 credit line, then $1500, pretty soon back up to 5K limits on multiple cards. Now if your planning on buying a house or car, you may need co-sign and even then you'll get wacked on interest. If someone doesn't hire you, an you suspect that reason, sue. for....wait for it...the big D!