If you’ve filed for bankruptcy in the past, you might be wondering how soon you can file for bankruptcy again. Read on to learn about the time limitations for wiping out debts after previously receiving a Chapter 7 or Chapter 13 bankruptcy discharge.
Bankruptcy law doesn’t set a minimum period that you must wait before filing for bankruptcy a second time. However, there’s a catch. If you file too soon after wiping out debt in a previous case, you won’t be eligible for another debt discharge (forgiveness).
Although there are times that it makes sense to file for bankruptcy even though you won’t receive a discharge, these situations are rare (more below). Because a bankruptcy filed too soon will end up being a waste of time and money in most cases, it’s essential to know how to time your bankruptcy filing.
Here are the timeframes if you plan to file the same bankruptcy chapter that you filed the first time:
Here are the waiting periods when a second bankruptcy case is a different chapter than the one you received your first discharge in.
Sometimes you don’t need a discharge—you just need time to pay off a debt. For instance, suppose that you owed federal taxes that you couldn’t discharge in bankruptcy and you were unable to work out a reasonable payment plan. Rather than have your wages garnished, you could file for Chapter 13 bankruptcy and stretch out the payments over a five-year Chapter 13 bankruptcy payment plan.
A similar approach is to file a Chapter 13 case immediately after receiving a Chapter 7 discharge (a procedure informally referred to as a Chapter 20 bankruptcy). Again, a common reason to do so is to secure additional time to pay off nondischargeable debts, such as domestic support obligation arrearages.
Not all courts allow the process, however, and it can be tricky to qualify for a Chapter 7 bankruptcy and then demonstrate that you have sufficient available income to pay into a Chapter 13 plan. Therefore, it would be wise to consult with a local bankruptcy lawyer before attempting to go this route.
In most situations, you can file again and receive a discharge in the second bankruptcy if you didn’t receive one in the first matter. But that’s not always the case. Also, you lose the full benefits of the automatic stay—the order that stops creditors from collecting—when you file multiple cases in quick succession.