I had a Chapter 7 discharge back in April, and about to graduate college with my Bachelors, and wanting to find a job with a government contractor, or another government agency. I've done a lot of research on the SF-86 form required, and the financial part of it. I did have some judgments, collections, credit card debt, and some debts that were all all included in the bankruptcy, and it is stated on my credit reports. If I'm offered a job do I need to answer yes to having those debts even though everything was discharged in the bankruptcy?
Be completely honest, and disclose the bankruptcy. Particularly since they will find it, anyway. Debts you discharged in bankruptcy are no longer debts, so instead of listing them each separately, you might mention that you did have debts, which were discharged in the BK case.
You need to answer every question on the SF-86 accurately. If you had a judgment you list it in the judgment section. If you had a debt in collections you list it in the Financial section. You can tell them it was discharged in the bankruptcy as part of the comments. Failure to list a debt will be seen as an honesty issue. The investigator will ask about your debts, failure to be open with the investigator is an honesty issue. Dishonesty, if deemed material and willful falsification, could debar you from federal employment for up to three years. Don't risk that by being lazy and thinking you can lump it all together. If the answer to the question is yes answer it yes and provide all the excruciating details. The bankruptcy will mitigate the financial problems but will never mitigate honesty issues...
To be safe, answer every question this way where there is a debt that you owed that was discharged in bankruptcy. "Yes but it was discharged in bankruptcy - Chapter 7 case #xx-xxxx, Northern Dist. of AL, Northern Division." See our blog post under the topic of security clearances at our web site for a lot of information here, www.BondandBotes.com, and also www.SecurityClearanceDefenseLawyer.com Best wishes.
