Clients often come to us unsure of whether bankruptcy is the right option for them, or whether they can file bankruptcy at all. If you’ve previously filed for bankruptcy, or if you think you may need to file more than once, this question becomes more complicated. The simple answer is yes, you can file for bankruptcy again, but the timing and other details are important.
The most important factor that will determine whether you can file for bankruptcy a second time is whether you received a bankruptcy discharge in your first bankruptcy case. In case you are unsure of whether this applies to you, a bankruptcy discharge is when you receive an order from the court at the conclusion of your case stating that you are longer personally obligated to repay any remaining debts. The United States Bankruptcy Code will then determine whether and when you can file a second bankruptcy, depending on which kind of bankruptcy you want to file.
After a Chapter 7 Bankruptcy Discharge
If you’ve filed for Chapter 7 bankruptcy and received your discharge, you have to wait eight years from the date you file the first case to the date you file the second case in order to receive another Chapter 7 discharge. The eight-year period runs from the date you filed for your first bankruptcy, not the date you were discharged.
If you want to file a Chapter 13 bankruptcy after having received a Chapter 7 discharge, you have to wait four years from the date you filed your Chapter 7 bankruptcy case. Again, the four-year period runs from the date you filed for bankruptcy the first time, not the date you were discharged.
Most Chapter 7 cases last approximately four to six months before the discharge is entered and the case is closed. As a result, you have to wait approximately seven and a half years to file another Chapter 7 case or 3 and a half years to file a Chapter 13 case after you receive your bankruptcy discharge.
After a Chapter 13 Bankruptcy Discharge
If you have been discharged in a Chapter 13 bankruptcy, you have to wait 6 years before filing a Chapter 7 bankruptcy, and two years before filing another Chapter 13 bankruptcy case.
Again, these time periods run from the date you filed your first bankruptcy case, not from the date you were discharged. Because a Chapter 13 bankruptcy can take up to 5 years, this distinction is particularly important in this context - it means that you could file for Chapter 7 bankruptcy a year after being discharged. Alternatively, you could file a second Chapter 13 bankruptcy immediately after your discharge was entered.
If You Previously Filed But Did Not Receive a Bankruptcy Discharge
If you’ve filed for bankruptcy before but did not receive a discharge, there may be additional restrictions on filing another bankruptcy case. Specifically, these restrictions are imposed when your previous case was dismissed with prejudice. Cases are dismissed with prejudice if you willfully ignore court orders, your filing was deemed to have been in bad faith or fraudulent, or you filed multiple times in an attempt to abuse the bankruptcy process. In those cases, the court can prohibit you from filing another bankruptcy case for up to 180 days, and in truly egregious cases, even longer.
Why This Is Important
One of the most important elements of filing for bankruptcy is the automatic stay - the court’s order that prohibits your creditors from taking legal action against you or making other efforts to collect their debts. Understanding how these deadlines work ensures that you will be entitled to full protection of the bankruptcy stay. Otherwise, protection will be limited and creditors may still be able to go after you.
Even if your prior case wasn’t dismissed with prejudice, you still face problems if you file another bankruptcy case sooner than the deadlines described above. If you file another case within one year of the first case being dismissed, the automatic stay is limited to 30 days. If you had two or more cases dismissed within the last year, there is no automatic stay. However, your attorney may be able to file a motion asking that the automatic stay be extended or put in place, whichever is appropriate to your situation.
Contact a Minnesota Bankruptcy Attorney For Help
People file bankruptcy for a wide variety of reasons, and life is often unpredictable. As a result, you may find yourself having to file bankruptcy a second time, or refile after a previous bankruptcy case that failed. Whatever the reason may be, we believe that each of our clients’ financial situations is unique and a one-size-fits-all solution is rarely the best option. At Kain and Scott, our bankruptcy attorneys use their creativity, compassion, and experience to help you plot a course to a better future that is tailored to your specific needs and goals. If you would like to schedule a free consultation with one of our bankruptcy attorneys, call us today at 800-551-3292 or contact us online.