Over the past few years I have filed many Chapter 7 bankruptcies for real estate contractors, real estate brokers, and mortgage brokers. A common question pertains to bankruptcy’s effect upon their state – issued contrqactor’s and brokers license. These people are afraid that because they file bankruptcy the State of Florida will not renew their professional license, or that they State may refuse to issue a new license they intend to pursue after their bankruptcy.
I have not heard from any of my bankruptcy clients that they have lost or been denied a contractors or brokers license because they filed bankruptcy. There is protection in the Bankruptcy Code. The Code prohibits any governmental unit from denying or revoking a license because of a prior bankruptcy. Therefore, real estate professionals, as well as other professionals such as lawyers or accounts, should not worry about a bankruptcy ruining their professional carrier and their ability to earn a living after a bankruptcy.
Thanks Jonathan for this post.I don’t have any money left for paying my debt.I don’t file bankruptcy because i am afraid that my contractor license will canceled if i file a bankruptcy.Really grateful for this information.This will sort my tension as well as problem.
With regards Joe
Do you know of any instance where a person applying for a law license has encountered any problems? State bars, at least as far as I have seen, do ask the question.
Nice posting Jonathan. I have noticed that many of my clients have been erroneously told either by a colleague or employer that their financial troubles could indeed effect their work status. You and I know that there is nothing further from the truth, but because their is such a social stigma attached to filing bankruptcy, once the seed is planted, you know how the bulb blossoms.
License revocation is a common concern among bankruptcy clients that have state issued licenses to work. From my experience, as stated, I have not heard of any clients having their license denied. On the other hand, bankruptcy may be an item that may be considered for certain security related jobs that involve a security clearance.
does bankruptcy have an effect on your real estate license in Rhode Island
I am an Electrical primary Qualifier for a business in Florida that may have to file bankruptcy. Will this effect my license since I am the primary responsible person for the business?
A contractor, however, must hang his/her “shingle” somewhere, along with a bond (and the financial requirements for obtaining the bond) and if the business is likewise in financial distress, this could in fact pose a problem.