They (and one day, we will found out who they are) say that lightening doesn’t strike the same place twice, right? Well in the case of bankruptcy, misfortune can strike more than once. There are so many different life events that can make it extremely hard to dig yourself out of financial debt. It is fairly common to have multiple filings of bankruptcy in order to start with a clean financial slate again. How often can a debtor file for bankruptcy and how, if at all, will it change each time?
Time Limits – According to State and Federal law there are time restrictions on when you are eligible for another discharge in bankruptcy depending upon whether you previously received a Chapter 7 or Chapter 13 discharge and the type of bankruptcy you want to file now. The limits are as follows:
- Successive Chapter 7 Filings – If you have already filed a Chapter 7 and want to do so again you must wait eight years from the date you filed the previous case before you can file another Chapter 7 and receive a discharge.
- Successive Chapter 13 Filings – If you received your first discharge under Chapter 13, you cannot receive a second discharge in any Chapter 13 case that is filed within two years from the date that the first case was filed. Because it usually takes three to five years to complete a Chapter 13 repayment plan and receive a discharge, you can typically file for another Chapter 13 bankruptcy and be eligible for a discharge immediately after your first case is closed.
- Chapter 7 to Chapter 13 If your first discharge was granted under Chapter 7, you cannot receive a discharge under any Chapter 13 case that is filed within four years from the date that the Chapter 7 was filed. This can get tricky if you file your second case (the Chapter 13) between four and eight years after the Chapter 7 case and the court does not confirm your Chapter 13 plan.
- Chapter 13 to Chapter 7 – If your first discharge was granted under Chapter 13, you cannot receive a discharge under any Chapter 7 case that is filed within six years from the date that the Chapter 13 was filed. The only exceptions to the six-year waiting period are: if you paid all unsecured creditors in full in the Chapter 13, or if you paid at least 70% of the claims in the Chapter 13 and the plan was proposed in good faith and was your best effort.
If you need help sorting out these time limits and what would be best in your financial circumstances contact the Levine Law Office to discuss your unique situation.