Crucial Question: When Can I File Another Bankruptcy?

Determining if you can file another bankruptcy is a matter of timing. The timing will be determined by your prior and present bankruptcy chapter.  

A Fortunate Tool for Your Misfortune

No doubt you are not happy that you need to be thinking about filing bankruptcy again. We are really sorry that life has been so tough.

But when life gives you more than your share of tough breaks, knowing that the law will provide you another opportunity to get a fresh start is good.

The Timing Rules To File Another Bankruptcy And Receive A Discharge

If enough time has passed since the most recent case, you can file a bankruptcy case even if you filed one earlier (or more than one). How much time must pass 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.

When you obtain a discharge in Chapter 7, §727 of the Code determines the time limits for filing another bankruptcy. Otherwise, when you obtain a discharge in Chapter 13, §1328 of the Code determines the time limits for filing bankruptcy.

If you obtained your discharge under Chapter 7:

• You must wait 8 years after you file your case to file a Chapter 7.
• You must wait 4 years after you file your case to file a Chapter 13.

If you obtained your discharge under Chapter 13:

• You must wait 6 years after you file your case to file a Chapter 7 UNLESS 1) you paid 100% of the allowed unsecured claims, or 2) paid at least 70% of the allowed unsecured claims, proposed the plan in good faith, and the plan was your best effort. In this case, you don’t have to wait.
• You must wait 2 years after you file your case to file a Chapter 13.

The Timing Triggers Are the Case Filing Dates

Remember that the 2-, 4-, 6-, and 8-year periods are measured from the prior case’s filing date to the current filing date. The filing date is crucial because receiving a discharge in a Chapter 13 case can take five years.

Let’s provide another example. If you want to file a Chapter 7 case, and you had filed a Chapter 13 case on July 1, 2018, which was completed in 3 years, July of 2021, then you can file a Chapter 7 case any time after July 1, 2024, which is 6 years after the July 1, 2018 filing date (The completion date of the earlier Chapter 13 is not relevant).

The Earlier Case Must Have Resulted in a Discharge, or Else You Don’t Have to Wait at All

Another important fact you must understand is that the 2-, 4-, 6-, and 8-year periods only apply if your earlier bankruptcy case resulted in the discharge of debts. Discharge is the legal write-off of debts in bankruptcy. So must find out if you received a discharge in your earlier case to determine if these time periods impact the timing of your new case.

You most likely received a discharge of your debts if you completed your case successfully. In a successful case, you will receive a mailing from the court at or near the end of your case that states you received a discharge. Tell your new attorney if you doubt whether that happened in your case. He or she can quickly determine through a PACER search.

Be aware you may believe that your old bankruptcy case was successfully completed when it was not. 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 received 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

The 2-, 4-, 6-, and 8-year time periods only apply if you intend to receive a discharge in your new case. Otherwise, you don’t have to wait to file a 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, people file most bankruptcy cases so they can receive relief from debt. But there is a rare case, especially under Chapter 13, where the relief is not so much about discharging the debts as it is in paying them on the debtor’s own schedule and in protecting assets from collections activity.

For example, if you are behind on your home payments and child support payments, filing a Chapter 13 before the applicable time period has expired will still stop foreclosure and collection of 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. A discharge of debts would not be the purpose of this case—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.