How Many Times Can You File For Bankruptcy?
If you plan to file for bankruptcy and it’s not your first time, you might be asking yourself if there’s a limit on how many times a person can file or if there’s a certain time period that must pass between filings.
In this article, we aim to answer those questions clearly. We’re going to look at this issue from all angles to make sure that there is no ambiguity around the number of times someone can file for bankruptcy.
How Often Can You Declare Bankruptcy?
You can file bankruptcy as many times as you want. You can get discharged from your debt often, too.
While there are no limits on how often you can file for bankruptcy, the United States Bankruptcy Code imposes a minimum time period between bankruptcy filings. Some factors play into this, like when you receive a discharge of debts in a bankruptcy case or if your bankruptcy case was dismissed with prejudice.
Once you start a new case before the required waiting period has elapsed, then you will not be eligible for a discharge on that new case, however, you can still receive the benefit of an automatic stay (asset protection) and the ability to catch up on house and car arrears.
The frequency of Bankruptcy Discharges for Different Types of Bankruptcies
How many times you can file for bankruptcy largely depends on the type of bankruptcy you file. It is important that you understand which type of bankruptcy you’re filing (namely, whether it’s Chapter 7 or Chapter 13), and what the restrictions are on each.
Chapter 7 Bankruptcy
Once you have filed for a Chapter 7 bankruptcy, the court will deny you a debt discharge in your case if you have already discharged debt from either Chapter 7 or Chapter 11 cases filed within the last 8 years.
This means that you can file a Chapter 7 bankruptcy discharge about every 8 years. You have to wait until this time has elapsed until you can file for another Chapter 7 discharge.
It is important to note that the period starts from the date that the previous case was filed. Aside from the time duration, the bankruptcy court will also deny you a Chapter 7 discharge if you have received a discharge in either a Chapter 13 or Chapter 12 case that has been filed within the last 6 years.
Chapter 13 Bankruptcy
You are not allowed to have a second discharge under Chapter 13 bankruptcy if you received a discharge in Chapters 7, 11, and/or 12 cases filed within 4 years. For a new Chapter 13 case, the time period is 2 years.
If you had debts discharged under Chapter 13 but later decide to file for a Chapter 7, you have to wait 6 years from the filing date of your first bankruptcy case. However, there are exceptions to this rule.
For example, you can file for Chapter 7 sooner if you’ve paid your unsecured creditors in full. In Chapter 13, you would have to pay 70% of the claims and propose a plan in good faith with your creditors to file again.
The number of times can you file for bankruptcy largely depends on the type of bankruptcy that you have filed in previous years and if those cases were completed or not. For that reason, it is crucial that you keep all the paperwork of your previous bankruptcies. It will also help to seek aid from a bankruptcy lawyer for legal guidance.
Conditions That Can Revoke a Bankruptcy Discharge
While there is a chance for you to file for bankruptcy many times in your lifetime, it is critical to note that there are certain conditions that can lead to the revocation of your bankruptcy discharge. Regardless of whether you have been successful in filing for bankruptcy in the past, bankruptcy should not be used as a means to run away from your obligations.
The bankruptcy court can still revoke or deny your discharge if you do the following things:
- Attempt fraud: If you try to transfer or conceal a particular property to avoid liquidation under Chapter 7, you will find yourself in big trouble. Make sure that you tell your bankruptcy attorney about all transfers of property that you have made before you file for a bankruptcy. It is crucial to be able to explain the losses or deficiencies in your assets to the bankruptcy court.
- Conceal information: Keeping information from your attorney regarding your financial situation can get you in hot water with the bankruptcy court. It is important that you keep all records of your finances organized.
- Make false statements: This one is self-explanatory. Do not make false statements during court proceedings or intentionally falsify any documentation.
- Refuse to comply with the court order: You can lose your bankruptcy discharge if you refuse to comply with the court order. If the bankruptcy court asks you to make an appearance to explain yourself, you need to comply.
- Do not take the instructional course: When you file for a bankruptcy discharge, you are required to take additional instructional courses related to finance such as credit counseling and financial management. Failure to take these mandatory courses is grounds for the revocation of your bankruptcy discharge.
A request for revocation on your bankruptcy discharge will be filed if you are proven to have conducted any of the activities above. The request can be filed within a year of the discharge or before the date the case is closed.
The bankruptcy court will decide whether the allegations for fraudulent, concealment or unacceptable activities are true before any revocation occurs.
Filing for A Second Case Even If You Are Not Entitled to A Discharge
How often you can declare bankruptcy depends on the type of bankruptcy discharge that you have. But you can still file for a second case even if you were not entitled to a discharge on the previous cases that you have filed.
There are instances when filing for bankruptcy can help even if you are not eligible for a discharge. Situations such as being behind on your tax or mortgage payments allow you for an automatic stay. You can take time with a bankruptcy case to catch up on your missed debt payments. The automatic stay is applicable to everyone who wants to file for bankruptcy even if they are unable to get a discharge.
Think Before You File & Hire Legal Support
How often you can file for bankruptcy depends on the type of bankruptcy. It is therefore essential that you know the different conditions of each. But understanding everything by yourself can be a tough task.
To understand your options, you can seek help from a bankruptcy lawyer to help you choose the best course of action to take. Especially if you’re in Dallas or Fort Worth, get in touch with Leinart Law Firm if you need help with your bankruptcy case.