You’ve filed for bankruptcy, received a discharge from the bankruptcy trustee and now you’ve been hit by more financial troubles. Can you file a second time for bankruptcy protection? The answer is yes – depending on your particular situation – but getting the advice of a bankruptcy lawyer is quite important in this situation. Sometimes, medical situations, lost jobs and other emergencies cannot be avoided. But if you are simply not managing your money properly enough, a local bankruptcy attorney can make some recommendations to ensure that your second bankruptcy is your last. In the meantime, here are the rules that cover repeat bankruptcies:
It’s the Filing Date, Not the Discharge Date
The bankruptcy law does include rules on when a debtor can receive a second discharge in a bankruptcy case. Those time limits were extended when the federal bankruptcy law was revised in 2005. If you are trying to figure out if enough time has elapsed for you to file another bankruptcy, the best idea is always to seek a free consultation with an experienced bankruptcy lawyer.
In general, however, the bankruptcy clock runs from the date of the first filing to the second filing date. That’s actually good news for debtors, particularly anyone considering a second Chapter 13 filing. Since virtually all Chapter 13 reorganization plans are five years, the two-year wait under the law could be significant if the time was calculated from discharge to a second filing. Since it doesn’t, a second Chapter 13 is generally available immediately for debtors.
Time Limits Following a Chapter 13
As previously mentioned, a debtor who has filed for Chapter 13 protection and wants to file a second case under that chapter must wait two years after the first discharge. That makes a second Chapter 13 immediately available since it takes five years to complete the plan and receive a discharge. If you want a Chapter 7 liquidation bankruptcy following a discharge from Chapter 13, you must wait six years.
Time Limits Following a Chapter 7
If your first Illinois bankruptcy was under Chapter 7, you can file a Chapter 13 case once four years have elapsed from the filing of that Chapter 7 case. If your goal is to follow a Chapter 7 bankruptcy with a second Chapter 7 filing, you face the most restrictive time limitation under federal bankruptcy law. The required wait is eight years between the filing of two consecutive Chapter 7 cases.
Other Issues with Consecutive Bankruptcy Filings
Interestingly, federal bankruptcy law allows for unlimited bankruptcy filings. That’s because the specific language imposes the time limits only when a previous bankruptcy filing has ended with a discharge. If you filed for personal bankruptcy protection but did not get a discharge, you should be able to file again at any time. Check with your bankruptcy lawyer, however, because some courts may include a limit on a second filing when a bankruptcy case is dismissed. This is often 180 days, but your bankruptcy lawyer will have the paperwork to make sure your second case is filed within the proper time frame.
If your first bankruptcy was denied, and particularly if the denial involved what the court perceived as bankruptcy fraud on your part, those debts may not be available to be liquidated in a subsequent bankruptcy petition. Again, your bankruptcy lawyer will be able to explain the time frame and any other limitations if you decide to pursue a second bankruptcy filing.
Important Disclaimer: The information discussed above and throughout this website should not be relied upon to make any decisions without first speaking to a bankruptcy attorney. There are many intricate rules of law governing bankruptcy with many exceptions to the general rules that could change the advice given by an attorney based on the differing facts in each person’s special set of circumstances. THEREFORE, it is important to discuss any information contained in this website with one of our attorneys before taking any action or refraining from taking any action.
