Are Bankruptcy Records Public Information?
Under federal law, bankruptcy records are public information unless the record was filed under seal. Interested individuals can obtain case information from PACER or contact the Clerk of Bankruptcy Court in Delaware to obtain copies of a case file. However, the Judicial Conference amended the policies regarding privacy and public access to electronic case files. According to the new law, there is a restriction on public access to documents filed before December 1, 2003, and cases closed for more than one year on the Public Access to Court Electronic Records (PACER) system. Debtors may petition to seal confidential information on a bankruptcy record. These details usually include personal financial statements and social security numbers.
Record seekers looking for an alternative to government sources may obtain bankruptcy records from third-party websites. These non-governmental websites often come with tools that help simplify the search for single or multiple records. However, record availability on third-party sites tends to vary because they’re independent of government sources. To obtain bankruptcy case information using third-party sites, record seekers may need to provide:
- A complete name of the debtor involved in the record
- A bankruptcy case number
What are Delaware Bankruptcy Records?
Delaware Bankruptcy records contain the financial records and information of the business or individual filing for bankruptcy. The records also include information about the creditors and other pertinent case information. Under 11 U.S.C. § 107 of the bankruptcy code, these records are considered public records and can be accessed and copied by the public. The records can be obtained by contacting the Clerk of Courts at the Bankruptcy Court in Delaware in person, by mail, or by phone. Records may also be sought out online from the federal court’s Public Access to Court Electronic Records (PACER) service. Members of the public may also lookup bankruptcy records and information on numerous third-party websites
Bankruptcy in Delaware
In Delaware, the U.S. Bankruptcy Court, District of Delaware has jurisdiction over bankruptcy case hearings and discharges per 28 USC 1334. Individuals can file bankruptcy petitions and other court documents, make queries, and search for court dockets and general information about a case using the Case Management/Electronic Case Filing (CM/ECF). People can view and download copies of a bankruptcy case file through another e-tool known as PACER (Public Access to Court Electronic Records).
Bankruptcy refers to the set of federal rules and laws put in place to help individuals and businesses with more debts than they can pay. Declaring bankruptcy in Delaware provides an honest debtor with a way to avoid hardships and pay back their creditors. Creditors are usually paid back by the debtor liquidating their assets or reorganizing their assets to pay back over time. Filing for bankruptcy in Delaware and the subsequent proceedings can take place at the Bankruptcy Court for the District of Delaware.
Since Delaware has just one bankruptcy court, all cases must be filed in that court as the state courts have no jurisdiction over bankruptcy cases. Individuals may file for bankruptcy under the different chapters of the bankruptcy code depending on their general situation and the preferred outcome of the proceedings.
The Clerk of Court handles the maintenance and dissemination of bankruptcy case files. To obtain records, interested persons may visit the office from 8:00 a.m. to 4:00 p.m., Mondays to Fridays (excluding federal holidays). The Clerk's help desk is also available from 8:00 a.m. to 4:00 p.m. on weekdays. Members of the public needing help or making inquiries can call (302) 252-2887 or contact the office by email.
There are no restrictions to accessing bankruptcy records in Delaware. Due to this, bankruptcy records may be accessible through third-party websites providing search services.
What Do Delaware Bankruptcy Records Contain?
A Delaware bankruptcy court record contains detailed personal and financial information on the individual or company that filed for bankruptcy. These details include:
- The name of the company or individual in debt.
- The debtor's gross income and sources of income
- Assets such as stocks, real estate properties, money in the bank, and businesses
- The case number and case status
- A list of creditors, secured and unsecured.
- The date of filing
- The address and contact information of each creditor.
- The amount owed to each creditor.
- Brief information about the attorney presenting the case
- The name of the bankruptcy judge that heard the case
- The trustee's name: A trustee is a person or agency appointed by the judge to oversee the distribution of a debtor's assets to creditors.
How to Get Delaware Bankruptcy Records
Photocopies and certified copies of Delaware bankruptcy records are available at the Bankruptcy Court Clerk's office. Requesters must provide a copy request in writing, specifying the documents they require and the number of copies they wish to purchase. Certified copies cost $11 per document, and photocopies cost 50 cents per page. The Clerk charges 10 cents for copies printed from the Electronic Public Access Terminal at the courthouse. Debtors can make payments with cash, cashier's check, or money order. Other persons can pay via debit or credit cards, personal checks, money orders, cashier's checks, and cash. The Clerk's office is open from Monday to Friday, 8:00 p.m. to 4:00 p.m. but closed during federal holidays.
824 North Market Street
Wilmington, DE 19801
Phone: (302) 252-2900
Online access to bankruptcy court records is available via PACER for 8 cents per page. To use the portal, interested parties will need to sign up online or contact the PACER Service Center at (800) 676-6856 to get a username and password.
Court records not maintained or stored on CM/ECF or PACER, such as court CD recordings, documents, and video recordings, are also available for $32 each. To obtain a transcript, the requester should contact the court operator at (302) 252-2900 and ask for any available Electronic Court Recorder Operator.
Where to Conduct a Free Bankruptcy Case Search in Delaware
A free bankruptcy case search may be available through the courthouse where the case was heard. These courthouses have public access computers with which members of the public can review court records in person. Typically searches may be conducted for free, but if additional services are required, like copies or research aided by court staff, the inquirer will be required to pay a nominal fee.
Some third-party sites also offer free bankruptcy case searches. These non-governmental websites often come with tools that help simplify the search for single or multiple records. However, record availability on third-party sites tends to vary because they’re independent of government sources. To obtain bankruptcy case information using third-party sites, record seekers may need to provide:
- A complete name of the debtor involved in the record
- A bankruptcy case number
However, in most cases, the information provided through free searches will be limited.
How Do I Find Out if My Bankruptcy Case is Closed in Delaware
A debtor can view a bankruptcy case's status by accessing PACER (Public Access to Court Electronic Records). PACER is available only to registered users, who must make an eight cents-per-page payment to use the service. Interested persons can register for an account on the website or contact the Service Center on (800) 676-6856 or (210) 301-6440.
The Voice Case Information System provided by the Bankruptcy Court can serve as an alternative to knowing if a case is closed or not. With this system, people can access a bankruptcy case status by calling (866) 222-8029 The requester will need to provide details such as the party name, case number, or social security number. The service is free.
Can a Bankruptcy Be Expunged in Delaware
No, bankruptcy court records cannot be expunged in Delaware. However, one may file a petition to seal or redact parts of the record that contain sensitive information from public access. If successfully granted, the court will restrict access to confidential information on the bankruptcy record.
Also, citizens cannot request to remove a bankruptcy from a credit report. Under the Fair Credit Reporting Act, credit reporting agencies shall report a bankruptcy for no longer than ten years, beginning from the filing date. However, the Federal Trade Commission, Bureau of Consumer Protection makes provisions for correcting or removing errors in a bankruptcy report. To update or remove false information from a credit report, the debtor will need to file a written document to the credit reporting agency with enough details that validate the query. The credit reporting agency will forward the complaint to the information provider, who will examine the documents and rectify all errors. The credit reporting agency must provide the debtor with a written document detailing the final review.
What is the Downside of Filing for Bankruptcy in Delaware?
An immediate downside of filing for bankruptcy is the way it affects the individual’s credit score after they file for bankruptcy. Filing for bankruptcy will usually lower the credit score, most times the higher the score was initially the more it will reduce after bankruptcy. The effects usually last as long as 7 to 10 years depending on which chapter of bankruptcy was filed. There is also increased scrutiny from financial institutions with banks and credit card companies automatically canceling all the debtor’s lines of credit and credit cards. Other disadvantages of filing for bankruptcy are:
- It may become harder to secure mortgages and loans
- If chapter 7 is filed, the debtor may lose real estate and other assets
- The debtor’s name and financial records are now part of public records
- Difficulty in obtaining new employment and housing
- Debts like student loans, taxes, and child support are non-dischargeable and must still be paid
What is Chapter 7 Bankruptcy in Delaware?
In chapter 7 bankruptcy, the debtor submits his non-exempt assets to a trustee who will sell them and pay the creditors from the proceeds. For this process, chapter 7 bankruptcy is usually known as liquidation or straight bankruptcy. Individuals planning on filing for chapter 7 should be aware that they will most likely lose some property and should plan for it. Although the debtor may lose property and assets during the liquidation Delaware grants the debtor exemptions that allow them to retain some assets. In exchange for giving up these assets during the liquidation, the debtor is freed from all debt except specific non-dischargeable debts.
Do I Qualify for a Chapter 7 Bankruptcy in Delaware?
To qualify for chapter 7 bankruptcy in Delaware, the debtor’s income must be less than the state’s median income. According to U.S census data for March 2021, the annual median family income for Delaware was $61,395. Debtors who pass this first stage and now tested for the second stage where their monthly income is compared against their reasonable monthly expenses. If after subtracting the expenses from the income the debtor has little or no extra income to pay the debts they qualify for chapter 7 bankruptcy.
Filing for chapter 7 bankruptcy in Delaware is a lengthy and intricate process that includes some of the following steps:
- Qualify for filing chapter 7
- Gather the bankruptcy documents including proof of employment, tax returns, bank statements, etc.
- Take the first credit counseling course
- Obtain and fill out the Bankruptcy Forms
- Get Your Filing Fee
- Go and file the bankruptcy forms at the court
- Mail copies of all bankruptcy documents to your appointed Trustee
- Take the second credit counseling course
- Attend Your 341 Meeting
What is Chapter 11 Bankruptcy in Delaware?
Chapter 11 Bankruptcy form of debt relief that allows the debtor to pay their debts by reorganizing or restructuring the debt. For this reason, it is usually known as debt reorganization. The debtor must develop a plan that meets the approval of the creditors and the bankruptcy court. Chapter 11 filing aims to create a plan to reorganize the business so that it can pay all debts, remain open and possibly thrive. The plan may include renegotiating interest and modifying payment plans and due dates. It may also include downsizing or liquidating some of the companies assets and reducing the workforce to reduce expenses and free up funds.
Who Files for a Chapter 11 Bankruptcy in Delaware?
Chapter 11 bankruptcy can either be filed by the debtor or sometimes credits may come together to file against a delinquent debtor. It is voluntary when the debtor seeks debt relief on their own while involuntary petitions are filed by three or more creditors. The debtor is usually given a period of 4 months which can be extended to 18 months to develop the reorganization plan. If they are unable to create a plan within that time the creditor’s committee can propose their own reorganization plan. In some cases, if a satisfactory reorganization plan cannot be developed at this stage, the case may be dismissed or changed to chapter 7.
Why File for Chapter 11 Bankruptcy in Delaware?
Chapter 11 bankruptcy focuses on reorganizing the debt so that the debtor can pay his debt and still run the business instead of a trustee. The proposed plan may include modified interest rates and renegotiated installment payments. During the bankruptcy case, the debtor will be allowed to continue to run the company but most business decisions will require approval from the court. Depending on the amount of debt chapter 11 can be filed by private individuals, companies, and corporations. It is preferred because it allows a debtor to keep the property and luxury assets that would otherwise have been liquidated in a chapter 7 case.
What is Chapter 13 Bankruptcy in Delaware?
Chapter 13 bankruptcy allows a debtor to pay their creditors over a period using a structured repayment plan. It is usually filed by debtors that have a regular income and is sometimes called a wage earners debt repayment plan. Companies and corporations cannot file for chapter 13 but sole proprietorships and individuals are allowed to file. Debtors who file for chapter 13 bankruptcy are usually able to keep luxury items like houses and cars safe from liquidation. The debtor must prepare a repayment plan that will pay creditors over three to five years.
Do I Qualify for a Delaware Chapter 13 Bankruptcy?
For a debtor to qualify for chapter 13 bankruptcy the following criteria must be met:
- The filer must be an individual or sole proprietor of a business with a regular income
- The debtor’s discretionary income must be able to sustain the monthly installments proposed by the repayment plan.
- The debtor must have been filing taxes for four years before the date of filing
- The debtor must not have more than $1,257,850 of secured debts and $419,275 of unsecured debts(figures valid as of April 2019)
The debtor must pay a majority of non-dischargeable debts and show that part of their disposable income is going towards paying secured and unsecured debts. The debtor may use all forms of disposable income to pay their debts this includes any wages, disability checks, insurance checks, and welfare checks. The payment plans usually run for three to five years, the exact time is determined by the difference between the debtor’s monthly income and the Delaware state median income.
What is the Difference Between a Chapter 7 and Chapter 13 Bankruptcy in Delaware?
Chapter 7 and Chapter 13 bankruptcy differ from each other in several aspects including their eligibility requirements and their discharge time. Only individuals and sole proprietors of businesses may file for chapter 13 bankruptcy while corporations and companies may file for chapter 7 and chapter 13. Chapter 7 processes are usually completed in a few months while chapter 13 repayment plans last between 3 and 5 years. Chapter 13 bankruptcy also differs from chapter 7 in that there is a reduced risk of the debtor losing assets and property through liquidation. Debtors filing for chapter 13 have the chance to pay for secured debts like mortgages and car payments while holding on to the property.
What is Bankruptcy Protection in Delaware?
Bankruptcy protection is also referred to as an automatic stay which is placed on all filings and debt collection once a debtor files for bankruptcy. It stops creditors from harassing a debtor or forcefully collecting debts, assets, and property. When the debtor successfully files for bankruptcy the court will mail the automatic stay order informing all creditors and other owed parties of the filing. The bankruptcy protection of the automatic stay usually lasts as long as the bankruptcy process. This could be as short as 3 months and as long as five years depending on the type of bankruptcy that was filed. A creditor that willfully ignores or breaches the automatic stay order runs the risk of facing several penalties including:
- The debtor may file a lawsuit against the creditor
- Payment of court and lawyer fees
- Fines for being in contempt of court
- Damages may be awarded to the debtor
What are Delaware Bankruptcy Exemptions?
Delaware bankruptcy exemptions is a list of property, assets, and income protected from liquidation or creditors by bankruptcy laws. There are federal exemptions and state exemptions and according to the bankruptcy, code debtors may be required to use one or the other when they file. Delaware has its separate exemptions and any bankruptcy case filed in the state will be required to use the state’s exemptions and not the federal ones. According to Delaware state code Title 10, Chapter 49, bankruptcy exemptions in Delaware include:
- Exempt personal property: Personal items like bibles, school books, family portraits, clothes, religious items, and burial plots are exempt in Delaware.
- Vehicles and Tools of the Trade: The state allows a debtor to exempt $15000 in a vehicle and the tools used in his trade or employment. The exemption for the tools reduces a lot depending on the county question, falling to $50 in Kent and $75 in Sussex or New Castle.
- Retirement and Life Insurance Exemptions: the state allows exemption of insurance payments, tax-exempt retirement plans, and pensions. These include (401k)s, individual retirement account plans, life insurance, annuity contracts, defined benefits, and state employee pensions.
- Head of Family Exemptions: A resident of Delaware who s the head of a family may exempt an additional $500 worth of personal property.
- Wage Exemptions: Residents of Delaware can exempt eighty-five percent of the wages from any work or services undertaken in the state. This is only valid if the debt is not due to taxes, fines, or any debt owed to the state.
- Homestead Exemption: Delaware allows an exemption of $125,000 on the equity of any built-up home or real estate property that serves as the debtor’s main residence.
- Exemptions by spouses: When a married couple files together in Delaware they may sometimes be allowed to claim separate sets of exemptions. This may double some of the exemptions sums. All exemptions of property under the head of the family can be claimed jointly by a couple. It can also be claimed by one of the couples with the written approval of the other. This does not double the exemption or entitle each of the couples to every benefit allowed by the head of family exemption.
- Public benefit exemptions: Delaware exempts public benefits such as worker’s compensation, unemployment compensation, and social security benefits such as medicare.
- Delaware also exempts a $25,000 equip on any property providing it does not fall under the personal property or tools of trade exemptions.
How Much Does It Cost to File Bankruptcy in Delaware?
The cost of filing for bankruptcy in Delaware can vary depending on the type of bankruptcy being filed. Generally, a standard Chapter 7 or Chapter 13 case will cost between $300 and $400 to file with the U.S. Bankruptcy Court for the District of Delaware. This fee is determined by the Bankruptcy Court Miscellaneous Fee Schedule. However, additional costs may be incurred for hiring an attorney or completing the required credit counseling and financial management courses. On the other hand, filing fees for special cases such as a Chapter 11 reorganization plan are more expensive and can exceed $1,500.