When Can You File Again for Bankruptcy?
In a Nutshell
Yous can file more than 1 bankruptcy in a lifetime. How many times depends on how long it's been since your last defalcation case and what type of bankruptcy you filed. We'll pause information technology down for y'all.
Accept you filed bankruptcy in the past but are faced with a fiscal situation that you can't resolve despite your best efforts? If you're facing a possible wage garnishment due to unexpected medical bills, unpaid revenue enhancement debts, or any other blazon of debt y'all're no longer able to pay, you tin can ask the court for bankruptcy protection a second time.
Know that you're not alone. A 2006 paper on a found that viii% of bankruptcy filers end up filing defalcation over again. [ 1 ] The 2005 changes to the Bankruptcy Code, intended to reduce overall filings, accept non had much of an impact on this number. [ 2 ]
In this article, we'll look at simply how many times someone can file defalcation depending on the type of bankruptcy and the amount of time that has passed since the showtime case. We'll besides accept a look at what other debt-relief options are available if filing defalcation is not an selection and whether a bankruptcy chaser tin can assist you file a 2nd defalcation sooner.
Bankruptcy is a legal way for individuals who can no longer afford to pay their debts to get permanent debt relief through a defalcation discharge. The Defalcation Lawmaking provides for three types of consumer bankruptcies known every bit Chapter 7 bankruptcy, Chapter eleven bankruptcy, and Chapter xiii bankruptcy.
Dissimilar Types of Defalcation Explained
A Chapter 7 defalcation eliminates most debt, including credit card debt, without requiring repayment of whatsoever kind. Instead of a repayment plan, the Affiliate 7 bankruptcy procedure liquidates your not-exempt assets to partially repay your debts. A Chapter 13 bankruptcy allows you to keep all of your property as long every bit the monthly repayment plan pays for the value of your avails. The debts that don't become paid equally part of the repayment plan are discharged once the plan has been completed. The discharge of your debts gives y'all the fresh start you need.
The Chapter eleven bankruptcy process provides similar relief to that provided in Affiliate seven and Chapter xiii, merely is mostly reserved for filers with businesses or meaning assets and is a lot more expensive than even a Chapter 13 bankruptcy. This commodity volition focus specifically on Chapter 7 and Chapter 13 bankruptcy.
How it works
There is no limit to how many times someone can seek defalcation protection. To preclude an abuse of the bankruptcy process, the Defalcation Code requires a certain amount of time to laissez passer between cases that result in a discharge. This prevents people from running upwards high credit card balances and other types of debt and filing bankruptcy every few years.
What are the Time Limits
The type of bankruptcy filed in the previous case determines the fourth dimension limit between cases. The fourth dimension starts to run on the appointment the prior case is filed with the bankruptcy courtroom. The engagement the discharge was entered doesn't matter.
Chapter 7 defalcation ➡️ Chapter 7 bankruptcy: 8 years
This is the longest corporeality of fourth dimension between cases required by the Bankruptcy Code. Chapter 7 provides the quickest course of debt relief through a bankruptcy filing and doesn't require the filer to complete a repayment program before getting their bankruptcy discharge.
Chapter 7 bankruptcy ➡️ Chapter 13 bankruptcy: 4 years
It is possible to file Affiliate 13 bankruptcy presently afterwards receiving a Chapter 7 discharge, the filer simply won't be eligible to receive a Chapter 13 discharge in the second case. So, someone who successfully discharges their unsecured debts through Chapter 7 tin file a Affiliate thirteen bankruptcy to pay off tax debts or other types of debt that survived the prior example.
Chapter 13 bankruptcy ➡️ Chapter 7 defalcation: 6 years
This waiting period can be waived if you lot paid back 100% to your unsecured creditors in your Chapter 13 program (or in some cases where you paid dorsum 70% of your total debts) and the original case was institute to be in good faith. Plus, since a Affiliate 13 repayment programme tin can take up to 5 years to complete before resulting in a discharge, it's possible to file Chapter 7 bankruptcy about 1 year afterwards receiving a Chapter xiii belch.
Chapter xiii bankruptcy ➡️ Chapter xiii bankruptcy: 2 years
If y'all previously filed a Affiliate 13 case and received a discharge and are looking to file a Chapter 13 case over again, you accept to wait at least two years from the filing date of the first instance before filing the second example. This is pretty rare. The minimum length of a Chapter 13 repayment program is three years. Receiving a discharge before completing a three year plan is possible only if an unexpected hardship makes completing the plan impossible.
Repeat Chapter xiii bankruptcy filings are sometimes used to keep the payments on the filer's student loans or tax debts manageable. Since these types of debts can't be discharged, the time limit between cases is less important.
Tin can a bankruptcy chaser assist me file bankruptcy sooner?
A defalcation attorney tin't help yous get around the time limits, but they may be able to help y'all file a different blazon of bankruptcy than the ane you filed earlier and confirm the earliest date your second case tin be filed. This is peculiarly true if you filed a Chapter 7 bankruptcy but didn't go a discharge. Only a defalcation lawyer can give y'all legal advice virtually how before long your 2nd bankruptcy can be filed. They tin can too assistance you get a court guild to make sure your automatic stay doesn't elapse before your discharge is entered.
Do I have other debt-relief options?
If y'all are in between bankruptcy filings and unable to file another bankruptcy, you may have to consider other debt-relief options like debt consolidation or debt settlement. These alternatives can be tricky to navigate, and so beginning past getting a gratis evaluation of your fiscal situation through credit counseling. Besides, think that most police force firms handling bankruptcy matters offer free consultations.
Let'southward Summarize...
In short, you can file more than one bankruptcy in a lifetime. How many times depends on how long it's been since your last defalcation example. If you previously filed a Chapter vii bankruptcy and want to file Chapter 7 over again, the time flow is 8 years from when you concluding filed. If you filed Affiliate 7 and want to file a Chapter 13, the fourth dimension flow is 4 years from when you filed Chapter seven. If yous filed a Chapter thirteen and want to file another Chapter xiii, the time menstruation is two years from when you last filed. And, if you filed a Chapter 13 and want to file a Chapter seven the fourth dimension period is six years from when you filed.
If yous're eligible to file Affiliate 7 bankruptcy, simply tin't beget to hire a defalcation attorney, Upsolve's free tool can help yous set your bankruptcy forms and complete the defalcation procedure on your own.
Sources:
- American Bankruptcy Institute. ( 2006 ). Bankruptcy Repeat Filings. Police Review, 14(ane), 169-200 .
- Miller, Michelle M. & Miller, L. ( 2008, June ). Repeat Filers Under the BAPCPA: A Legal and Economic Analysis. Norton Annual Survey of Defalcation Law, p. 509, 2008 . Retrieved August 4, 2020, from https://ssrn.com/abstruse=1983377
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