Can Federal Employees with Security Clearance File for Bankruptcy?
If you’re a federal employee living in Maryland with security clearance and you're struggling with debt, you may be wondering:
“Can I file for bankruptcy without losing my security clearance?”
The short answer is yes—you can file for bankruptcy, and doing so does not automatically jeopardize your clearance. In fact, filing for bankruptcy in a responsible and transparent manner may actually help protect your clearance by demonstrating that you are taking steps to resolve your financial problems.
At Bankruptcy Near Me, a private law firm, we’ve helped many Maryland federal employees—including those working in D.C., Bethesda, Fort Meade, and other federal hubs—navigate the bankruptcy process while preserving their security clearance.
✅ Filing for Bankruptcy Can Protect Your Security Clearance
If you're carrying significant unsecured debt, such as credit card balances, personal loans, or medical bills, this can raise red flags for your clearance, particularly under Guideline F: Financial Considerations of the Adjudicative Guidelines for Determining Eligibility for Access to Classified Information.
Here’s the good news: filing for Chapter 7 bankruptcy in Maryland is a legal, proactive way to resolve your financial situation. It shows that you are taking your obligations seriously rather than ignoring or concealing your debt.
🚩 What Raises Security Clearance Concerns?
Although bankruptcy itself is not disqualifying, the following can raise serious concerns with clearance investigators:
Failing to disclose your bankruptcy on the SF-86 or during reinvestigation
Hiding debt or assets
A pattern of ongoing financial irresponsibility
New unexplained debt after filing
Fraudulent behavior or misuse of funds
By comparison, being honest and transparent about your financial challenges is seen as mitigating behavior.
🔍 What Will Clearance Investigators Look At?
If you're a Maryland federal worker or contractor and you file for bankruptcy, investigators will consider:
The nature and cause of your financial problems
Whether the situation was due to factors beyond your control (medical issues, divorce, job loss, etc.)
Whether you’ve made a good faith effort to pay debts before filing
Whether you’ve shown a pattern of financial responsibility since filing
A clean, well-documented bankruptcy filed in good faith can actually be seen as a stabilizing step, not a risk factor.
💼 Common Clearance-Holding Jobs in Maryland
Many clearance holders live and work in or near:
Fort Meade
NSA
Andrews Air Force Base
Department of Defense (DoD) contractors
Bethesda NIH and federal health agencies
D.C. metro agencies
Whether you’re a GS employee, federal contractor, or military member, you may be eligible to file for Chapter 7 bankruptcy in Maryland without losing your clearance.
🧠 Myth vs. Fact
Myth Fact
Filing for bankruptcy means automatic loss of clearance False – Filing responsibly can mitigate risk
You should hide debt or bankruptcy from clearance investigators False – Honesty and disclosure are critical
Clearance holders can’t get a fresh start through bankruptcy False – Many do, and keep their clearance
📝 What You Should Do If You're Considering Bankruptcy in Maryland
Talk to a Maryland bankruptcy attorney who understands the unique concerns of clearance holders.
Disclose everything honestly on security clearance forms (SF-86, etc.).
Document the circumstances of your financial hardship.
Avoid taking on new unsecured debt post-filing.
Stay current on bills and obligations moving forward.
📍 Need Legal Help? Contact Bankruptcy Near Me – Maryland Office
If you are a Maryland-based federal employee or contractor considering Chapter 7 bankruptcy, the team at Bankruptcy Near Me can help. Our attorney, Iris Kwon, is experienced in handling bankruptcy cases for clearance holders and understands the nuances of local trustees, courts, and federal employment concerns.
📍 Location: Kensington, Maryland
📞 Phone: 301-550-5408
📧 Email: info@bankruptcynearme.org
🌐 Website: www.bankruptcynearme.org
💬 Final Thoughts
Filing for bankruptcy doesn’t mean you’ll lose your job—or your clearance. If you live in Maryland and hold a clearance, you can file for bankruptcy and keep your future on track. The key is honesty, proper legal guidance, and responsible financial behavior moving forward.
Let us help you get the fresh start you deserve—without risking your livelihood.