It can happen to the best of us. Despite your best intentions, circumstances beyond your control can lead to bankruptcy a second time. The same reasons that bring people to bankruptcy in the first place: divorce, unemployment, and unexpected medical expenses, are things that we have little control over and, unfortunately, can cause financial circumstances to spiral out of control. While the bankruptcy laws discourage people from filing multiple times, they allow individuals to file more than once. The same rules that allowed you a fresh financial start the first time will give you a second chance to get back on your feet.
When you can file a second bankruptcy can depend on different factors including when the first case was filed and whether or not the case was discharged or dismissed. It can also depend on whether your first case was a Chapter 7 or Chapter 13 and what chapter you will be filing in your second case. Generally, the refiling times are set out below:
- If you previously filed a Chapter 7 bankruptcy and your debts were discharged in that case, you can file another Chapter 7 bankruptcy after 8 years from the date that your prior Chapter 7 was filed. If your prior bankruptcy was dismissed, you may be able to file sooner.
- If your prior bankruptcy was a Chapter 13 bankruptcy, you may not file for Chapter 7 bankruptcy until 6 years after your Chapter 13 case was discharged. Again, if the Chapter 13 was dismissed, you may be able to file sooner. Also, if you paid off more than 70% of your unsecured creditors in your prior Chapter 13 case, you may be able to file sooner.
- If your prior bankruptcy was a Chapter 7 bankruptcy, you may file a Chapter 13 bankruptcy 4 years after your prior Chapter 7 bankruptcy was discharged.
- If your prior bankruptcy was a Chapter 13, you may file another Chapter 13 bankruptcy 2 years after your prior Chapter 13 case was discharged.
It is important to be aware of the timing of a second bankruptcy case. If you file too soon, your case may be dismissed, and you will lose the protections of bankruptcy and creditors can proceed against you, including suing you and garnishing your wages. You should work with an experienced bankruptcy attorney to help guide you through this complicated process.
If you are considering bankruptcy, we hope you’ll sit down with one of our attorneys for a free consultation to learn if you are eligible. Filing bankruptcy a second time may not be your best option. If we don’t think it is, we’ll tell you and discuss other options with you.
