Filing for bankruptcy can often be the first step in regaining control over your financial independence and reducing debt to a manageable level. While anyone can file for bankruptcy, there are certain elements of bankruptcy law in place that offer protection to active-duty military personnel. Here’s a closer look at special considerations you may be entitled to.

Bankruptcy 101 for Active-Duty Military Members

Servicemembers’ Civil Relief Act

The Servicemembers’ Civil Relief Act (SCRA) is designed to help protect you during active-duty status. The act allows courts to postpone bankruptcy proceedings, which can give you peace of mind and keep you from needing to resume the legal proceedings until 90 days after you’ve returned home. The SCRA bankruptcy law also provides a number of other legal benefits to military personnel, including protection during non-bankruptcy cases.

You May Be Temporarily Exempt from Chapter 7 Means Testing

If you’re a member of the National Guard or in the Armed Forces reserves and were called to active duty for at least 90 days after 9/11, you may be temporarily exempt from Chapter 7 means testing under bankruptcy law. This temporary exemption applies while you’re on active duty and continues for 540 days after you’ve returned home. After this grace period, you have 14 days to complete the means test.

Your Security Clearance May Be Affected by Bankruptcy

Filing for bankruptcy can have both positive and negative effects on your security clearance as an active-duty military member. These determinations are handled on a case-by-case basis and are affected by your reason for filing for bankruptcy, your job performance, and your workplace relationships. The filing can also be seen as a positive step toward regaining financial independence. Because large amounts of debt are seen as security risks in the military, filing for bankruptcy may help you avoid losing your clearance.

Consult a lawyer who’s well-versed in both military and bankruptcy law by calling Donna C. Crooks, Attorney at Law in Enterprise and Dothan, AL. Attorney Crooks is an experienced legal professional with more than 20 years of experience in serving military and civilian clients. She’ll guide you through the complexities of your case and help you get your financial situation back on track. Her office is conveniently located just outside of the Daleville Ft. Rucker gate, and she offers phone consultations to anyone who can’t make it in person. Call (334) 598-9534 today to set up your free initial consultation or visit the website to learn more about the practice.