They say the third time’s a charm, but if you are unfortunate enough to consider filing for bankruptcy multiple times, you know this is not always true. Filing for bankruptcy does not get easier each time. In fact, there are limits on your ability to file if you have done so in the past.
You Can File For Bankruptcy As Many Times As You Need To… In Theory
There are no limits on the number of times you can file for bankruptcy. You may file as many times as you need to.
However, the law does require you to wait a certain amount of time between filings. These waiting periods end up limiting the number of times many people can file for bankruptcy. The amount of time it takes to be eligible for another discharge of debt depends on the type of bankruptcy you filed previously, and the type of bankruptcy you wish to file this time.
The Two Main Types Of Personal Bankruptcies
How long you will need to wait to file bankruptcy again depends on the type of bankruptcy you filed previously. Most people file under Chapter 7 or Chapter 13.
Chapter 7 bankruptcies are traditional “fresh start” bankruptcies. In a Chapter 7 bankruptcy, your assets are turned over to your creditors or sold off, then your remaining unsecured debts such as credit cards and medical bills are discharged.
Chapter 13 bankruptcies are court-supervised repayment plans. You get to hold on to assets you are able to afford by paying off your debts a little at a time. If you make all of your payments during the 3-5 year repayment period, your remaining debts can be discharged.
If You Previously Filed Under Chapter 7
If you previously filed for bankruptcy under Chapter 7, you must wait 8 years from the date of your previous filing to file another Chapter 7 bankruptcy.
If you want to file under Chapter 13 this time around, you are only required to wait 4 years
If You Previously Filed Under Chapter 13
If you previously discharged some debts through the Chapter 13 bankruptcy process, you must typically wait 6 years from the date of your filing to file again under Chapter 7. However, if you raid at least 70% of the claims in your Chapter 13 case, and you proposed the plan in good faith and used your best effort to repay creditors, you can file virtually immediately.
If you want to file under Chapter 13 again, you must wait 2 years to qualify for another discharge.
Help With More Than The Math
Rather than trying to remember the details of your case, and do the math yourself to figure out if you can file for bankruptcy again, we recommend reaching out to the experienced Milwaukee bankruptcy attorneys on the Hanson & Payne team. A blog post like this can give you basic information, but it can’t tell you what options are actually available to you. Our team will listen to your side of the story, and help you figure out the best way to move forward. Contact us today to schedule a free consultation.