Is filing bankruptcy a safe financial practice for military service members? Chapter 7 and Chapter 13 are two types of bankruptcy options for military personnel.
Before they were famous, many truly influential men and women started by serving their country in the US military or grew up in military families.

Considerations for Bankruptcy During Military Service

For military service members, controlling debt can be frustrating and emotionally draining.

Overwhelming debt can even affect your military readiness.

It's easy to be seduced into unsafe loans with high interest rates and mounting penalties. Unexpected expenses may have caused you to use payday loans. Using unsafe lending can cause your debt to spiral out of control and the option to file for bankruptcy can seem like a relief.

Is filing bankruptcy a safe financial practice for military servicemembers?

Understand that while it is an option, filing for bankruptcy can be harmful to your military career and future finances, especially for active duty military service members. But if you are ready to consider bankruptcy, here is what you should know.


As active duty military service members, you can file for bankruptcy if needed, and be afforded all the same bankruptcy protection rights as civilians. Filing for bankruptcy legally protects service members from creditors; still, it is a serious step that should be treated as a last-resort option.


Before you file, know the consequences for your future credit ratings and military career.

Military bases provide financial consultations specifically for military service members considering bankruptcy. You can find the support you need from these valuable and free military advisors, who may show you other financial options that will offer more financial stability military future.

Seeking help from your military base financial advisor is an essential first step; these advisors know that there are military-specific issues when it comes to filing for bankruptcy. For example, they can advise you about pursuing bankruptcy when you have a Military Star card, the credit card used at U.S. military exchanges. Military service members stationed overseas may need a power of attorney to file on their behalf in their home jurisdiction.


There are different types of bankruptcy options for military service members.

Chapter 7 bankruptcy discharges your debts, while Chapter 13 bankruptcy gives you a window of three to five years to pay off creditors. You have the option to choose the bankruptcy chapter that suits your needs.

Once you and your military advisor decide on the bankruptcy option, you will need to get a chapter-specific petition for bankruptcy form at the bankruptcy court clerk's office. As you fill out your form, include all of your creditors, including the Military Star card.


The process of filing for bankruptcy requires a military mind for detail and organization.

Federally contracted investigators will perform credit checks and compare actual reports with the financial information you, the military service member, has provided. Full disclosure is required, and any transgression can lead to suspension of classified access, hurting your ability to recover your finances.

Before filing your bankruptcy petition, double-check your information to avoid penalization that could disrupt your active military career.

Even military heroes need support when it comes to managing debt and finances. If you are in a position to need to file bankruptcy, make sure you know how and when to file for bankruptcy as a military service member; seek the support of a military financial advisor on your base.


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