How Often Can I File Bankruptcy?
How long do you have to wait between bankruptcies? In A Nutshell
If Discharge Received In Prior Bankruptcy
-
Previous Chapter 7 ⇒ New Chapter 7 = 8 years
-
Previous Chapter 7 ⇒ New Chapter 13 = 4 years
-
Previous Chapter 13 ⇒ New Chapter 7 = 6 years
-
Previous Chapter 13 ⇒ New Chapter 13 = 2 years
If No Discharge Received In Prior Bankruptcy
-
Can Refile Successive Chapter 13s
-
But This Could Result In Negative Consequences
In More Detail
How Often Can I File Bankruptcy?
Due to unforeseen, unexpected circumstances that arise in the lives of people within a household, individuals or spouses are sometimes forced to consider filing for bankruptcy again. A son may get very ill causing the parents to incur great medical expenses. The wife may lose her job of 20 years because the company is downsizing and cutting costs, causing the household bills to suddenly become unaffordable. The list of scenarios can go on and on.
While folks who have been through bankruptcy know of its consequences, they also know that it can be a useful tool allowing the family to regain control of their finances. Bankruptcy allows the filer to rid himself of unsecured debt (credit cards, medical bills, personal loans) and to make secured debt (car loan, mortgage) more affordable. The filer also has the ability to wipe away secured debts that he no longer wants. I have explained all of this more in my various posts regarding Chapter 7 and Chapter 13.
I often get asked the question “How often can I file bankruptcy?” The answer, as with most answers coming out of the Bankruptcy Code, is a little complicated. But, for the most common situations, it can be broken down as follows:
If your 1st case was a Chapter 7:
Chapter 7 ⇒ Chapter 7 = 8 years
If your 1st case was a Chapter 7 and you received a discharge, then you can file another Chapter 7 eight years after the date your 1st case was filed.
EXAMPLE: you filed a Chapter 7 on February 1, 2015. You can file another Chapter 7 after February 1, 2023.
Chapter 7 ⇒ Chapter 13 = 4 years
If your 1st case was a Chapter 7 and you received a discharge, then you can file a Chapter 13 four years after the date your 1st case was filed.
EXAMPLE: you filed a Chapter 7 on February 1, 2015. You can file a Chapter 13 after February 1, 2019.
If your 1st case was a Chapter 13 and you received a discharge:
Chapter 13 ⇒ Chapter 7 = 6 years
If your 1st case was a Chapter 13 and you received a discharge, then you can file a Chapter 7 six years after the date your 1st case was filed. Note: you may be able to file the Chapter 7 sooner than six years if your Chapter 13 paid 100% to unsecured creditors or if it paid at least 70% of your unsecured creditors and was proposed in good faith.
EXAMPLE: you filed a Chapter 13 on February 1, 2015, paid 0% to unsecured creditors, successfully completed the plan, and received a discharge. You can file a Chapter 7 after February 1, 2021.
Chapter 13 ⇒ Chapter 13 = 2 years
If your 1st case was a Chapter 13 and you received a discharge, then you can file another Chapter 13 two years after the date your 1st case was filed. Note: this is rare because Chapter 13s typically last a minimum of 3 years.
EXAMPLE: you filed a Chapter 13 on February 1, 2015. One month into your case you win a scratch off lottery ticket worth $80,000. This is enough to pay off your creditors in full. You receive a discharge 6 months after your case is filed. You can file another Chapter 13 after February 1, 2017.
If your 1st case was a Chapter 13 and you did NOT receive a discharge:
- Then you can file another Chapter 13 or a Chapter 7.
- Note: there are consequences in filing successive Chapter 13s within small time frames. This should only be done with the counsel of an attorney.
Now that you know how often you can file bankruptcy, you might be wondering if you should. I recommend that you speak with an attorney to explore your specific situation. You can begin this process with me at no cost by completing the online intake form. Or, you can skip the online intake form and set up a free consultation with me. This consultation can be done in my office, over the phone, or virtually through Facetime, Zoom, Google Meet, or Skype.