Crucial Question: If I Filed a Bankruptcy Once Before But Am Now Again in Serious Financial Trouble, Can I File Again?
It’s a matter of timing. And that timing depends on whether you previously filed under Chapter 7 or 13, and what you are filing under now.
A Fortunate Tool for Your Misfortune
No doubt you are not happy that you need to be thinking about bankruptcy again. We are really sorry that life has been so tough.
But when life does give you more than your share of tough breaks it IS good to know that the law gives you another opportunity to get a fresh start.
The Timing Rules
You most certainly can file another bankruptcy case if you filed another one earlier (or even more than one) simply if enough time has passed since that earlier (or most recent) case. How much time must pass mostly depends on whether your earlier case was a Chapter 7 “straight bankruptcy” or a Chapter 13 “adjustment of debts,” and which of these you want to file now.
If your earlier case was a Chapter 7 one:
- to now file a Chapter 7 case you must wait 8 years after the earlier case
- to now file a Chapter 13 case you must wait 4 years after the earlier case
If your earlier case was a Chapter 13 one:
- to now file a Chapter 7 case you must wait 6 years after the earlier case (UNLESS in that earlier Chapter 13 case you paid 100% of the allowed debts, or paid at least 70% and met some other conditions, when you don’t have to wait)
- to now file a Chapter 13 case you must wait 2 years after the earlier case
The Timing Triggers Are the Case Filing Dates
These 2-, 4-, 6-, and 8-year time periods are measured from the FILING date of your earlier case to the FILING date of your new case. That’s crucial because that starts the clock earlier than it was instead tied to any of the subsequent events within the case (such as the discharge—the legal write-off—of the debts, or the completion of the case). That’s particularly important if your earlier case was a Chapter 13 one because they can last a long time after they are filed, as much as five years (and sometimes even slightly longer).
Let’s make this clearer with an example. If you now want to file a Chapter 7 case, and you had filed a Chapter 13 case on July 1, 2008, which was completed in 3 years, in July of 2011, then you can file a Chapter 7 case any time after July 1, 2014, which is 6 years after the July 1, 2008 filing date. (When that earlier Chapter 13 case was completed is irrelevant.)
The Earlier Case Must Have Resulted in a Discharge, or Else You Don’t Have to Wait at All
These 2-, 4-, 6-, and 8-year time periods only apply if your earlier bankruptcy case resulted in the discharge of debts. As mentioned above, “discharge” is the legal write-off of debts in bankruptcy. So you want to find out if you got a discharge in your earlier case to see if these time periods impact the timing of your new case.
You most likely did get a discharge of your debts if you finished your case successfully. Very near the end of either a Chapter 7 or Chapter 13 case you should have been mailed an order from the bankruptcy court stating that your debts were discharged. If you have any doubt whether that happened in your case, tell your new attorney. He or she may be able to find out quickly, if those records are recent enough to be electronically stored at the bankruptcy court.
Be aware that people sometimes assume that an old bankruptcy case finished successfully and resulted in a discharge, when in fact it didn’t. So when you start considering a new bankruptcy case, if the applicable time period has not yet passed make sure that your attorney determines whether or not you really got a discharge. If you didn’t, you can file your new case whenever you want.
If You Don’t Need a Discharge in Your New Case, You Also Don’t Have to Wait at All
Assuming that you did get a discharge in your earlier bankruptcy case, the 2-, 4-, 6-, and 8-year time periods also only apply if you intend to get a discharge of your debts in your new case. Otherwise, you don’t have to wait to file the new case.
Why would somebody file a bankruptcy case if they don’t need a discharge of their debts—isn’t that the main reason people file bankruptcy? Yes, in most bankruptcy cases that is why they are filed, to get relief from debts. But there is the rare case, especially under Chapter 13, where the relief is not so much in discharging the debts as in paying them on the debtor’s own schedule, and in protecting his or her assets from collections activity in the meantime.
For example, if you are behind on your home payments and child support payments, filing Chapter 13 case before the applicable time period has expired will still stop a foreclosure and will stop the collection of the past-due support payments. You would be able to catch up on your back mortgage and support payments over the three-to-five-year course of your Chapter 13 case. The purpose of this case would not be to get a discharge of debts—these are debts you must pay to save your home, and to prevent aggressive collection by your ex-spouse or the support enforcement agency. Rather its purpose would be to protect your home and your paycheck/bank account/other assets while you gradually paid these two creditors current, and did so based on your budget rather than upon their demands.
So if your applicable time period has not yet expired and you need relief, talk to your attorney about whether relief without a discharge would be helpful in your situation.