How Often Can You File For Bankruptcy?
Richard Fonfrias, J.D.
Chicago's Financial Rescue & Bankruptcy Lawyer
Fonfrias Law Group, LLC
The law does not limit how often you can file for bankruptcy. Instead, the law requires a minimum time period between discharges from the bankruptcy court, as follows:
Chapter 7 Bankruptcy Cases
If your first bankruptcy discharge was a Chapter 7 case, then you cannot get a second discharge in a Chapter 7 case within eight years from the date the first Chapter 7 case was filed.
Chapter 13 Bankruptcy Cases
If your first bankruptcy discharge was a Chapter 13 case, then you cannot get a second discharge in a Chapter 13 case within two years from the date the first Chapter 13 case was filed.
This can pose a problem if you file a second Chapter 13 bankruptcy case between the second and sixth years after the first Chapter 13 case and the bankruptcy court does not confirm your repayment plan in the second case. Most times, in a situation like this, you could convert your Chapter 13 case to a Chapter 7 case. But under these circumstances, different rules come into play to keep you from getting a discharge (see below).
When You File Under Different Chapters
When your file one chapter of bankruptcy and get a discharge, and then file a second chapter that is different, the order in which you file determines the timing:
Chapter 13 First, Then Chapter 7
If you received a Chapter 13 bankruptcy discharge, then you cannot receive a Chapter 7 discharge in a case filed within six years from the filing date of your Chapter 13 case. You have two exceptions to the six-year waiting period:
(1) If, under the Chapter 13 bankruptcy, you paid all of the unsecured creditors in full; or
(2) If, under the Chapter 13 bankruptcy, you paid at least 70% of the claims and you proposed a good-faith plan, which you carried out in your best efforts.
Chapter 7 First, Then Chapter 13
If you received a Chapter 7 discharge, then you cannot receive a Chapter 13 discharge in a case that is filed within four years from the date your Chapter 7 case was filed.
This can pose a problem if you file a second Chapter 13 bankruptcy case between the fourth and eighth year after the first Chapter 7 case and the bankruptcy court does not confirm your repayment plan in the second case. Most times, in a situation like this, you could convert your case to a Chapter 7 case. But under these circumstances, rules for consecutive Chapter 7 discharges come into play to keep you from getting a discharge (see below). It could make sense to dismiss your Chapter 13 repayment plan case.
A Second Bankruptcy Filing Might Help ... Even Without a Discharge from the First
After you get a Chapter 7 discharge, you're supposed to wait four years before filing your Chapter 13 case. However, you might benefit from filing your Chapter 13 bankruptcy immediately, in what is known as a Chapter 20 bankruptcy. While you won't be able to get a bankruptcy court discharge, you will get court protection while you pay your tax debt through your Chapter 13 repayment plan.
The degree to which you might benefit depends on your personal situation and the law in your area. You're welcome to call me and discuss your personal situation to see if this might help you. You can reach me at 312-969-0730.
If You Didn't Get a Discharge In Your First Bankruptcy Case ... then you can likely file bankruptcy again
In Case of a Dismissal
You can always file your bankruptcy case again unless the bankruptcy court orders otherwise. If your case was dismissed for a specific reason, such as your failure to obey a court order or failure to appear in the case, a 180-day waiting period may apply.
In Case The Court Denied Your Discharge
If this occurred, you will likely be able to file again, but you probably won't be able to discharge the debts from your first case. Make sure you discuss this situation with an experienced bankruptcy lawyer.
If you are contemplating bankruptcy and have questions, it is always best to consult with an experienced bankruptcy attorney to discuss your options. Filing for bankruptcy in Illinois? Speak with Chicago Money Lawyer Rich Fonfrias. Rich is a respected Chicago financial rescue and bankruptcy lawyer serving Illinois and the greater Chicago area. He provides a full range of financial legal services, including bankruptcy, mortgage and loan refinancing, credit repair foreclosure assistance and debt consolidation, foreclosure avoidance. Your initial consultation with Rich is free.