If you’re thinking about filing for bankruptcy, and have filed in the past, you may be wondering how often you can file for bankruptcy. How often you can file depends upon your specific circumstances. This includes which type of discharge you received previously.
From Chapter 7 bankruptcy to Chapter 13 bankruptcy
Actually, you can file a Chapter 13 bankruptcy immediately after filing a Chapter 7 bankruptcy. It is known as a “Chapter 20 bankruptcy.” This is a strategy employed for a client who is eligible to file a Chapter 7 but is also in need of:
- catching up a house payment
- restructuring a car payment
- or paying off a priority debt, like the IRS.
The Chapter 7 bankruptcy eliminates all unsecured debt. Upon discharge, the Chapter 13 bankruptcy is filed to restructure the secured debt payments. There is no Chapter 13 bankruptcy discharge in this scenario. However, the discharge isn’t needed, since the client already received a Chapter 7 bankruptcy discharge.
If there is at least 4 years between the Chapter 7 bankruptcy filing and the subsequent Chapter 13 bankruptcy filing, a Chapter 13 bankruptcy discharge will be granted upon the successful completion of your Chapter 13 plan.
Consecutive Chapter 7 Bankruptcies
How often can you file consecutive Chapter 7 bankruptcies? If you received a discharge in a Chapter 7 bankruptcy, you must wait eight years. This period begins on the date the previous case was filed before another Chapter 7 can be filed. To be clear, you count the 8 years from old filing date to new filing date. You do not count from old discharge date to new filing date.
Consecutive Chapter 13 Bankruptcies
- If your debts were discharged in a prior Chapter 13 bankruptcy case, you must wait two years from the date the old Chapter 13 case was filed to file a new Chapter 13. A Chapter 13 bankruptcy case normally takes 3 to 5 years to complete. So, the average debtor can file a new Chapter 13 as soon as the old one is discharged.
- If your prior Chapter 13 bankruptcy case is dismissed (usually for non-payment), you can file a Chapter 13 case immediately. However, if this is the second active Chapter 13 case you’ve had within a 12-month period, the automatic stay only applies for 30 days. You must file a Motion to Extend the Automatic Stay. In addition, you must show the bankruptcy judge that (a) your financial circumstances are different now than when your previous bankruptcy was filed and (b) that you will now be able to successfully complete the new Chapter 13 case.
- If the new Chapter 13 bankruptcy will be your third Chapter 13 in the last 12 months. There is NO automatic stay when the case is filed. You will need to file a Motion to Impose Automatic Stay. Also, you must show the bankruptcy judge that (a) your financial circumstances are different now than when your previous TWO bankruptcies were filed and (b) that you will now be able to successfully complete the new Chapter 13 case. For those with a third Chapter 13 case within the last 12 months, you really need to discuss your situation a qualified bankruptcy attorney to determine what course of action is best for you.
From Chapter 13 to Chapter 7 Bankruptcy
If you received a discharge in a previous Chapter 13 bankruptcy, you must wait six years from the date the Chapter 13 was filed before you can file a Chapter 7 bankruptcy and receive a discharge. However, there are two little-known exceptions to this general rule. If you paid back 100% of your unsecured creditors you can immediately file a Chapter 7 bankruptcy. In addition, you can file a Chapter 7 bankruptcy immediately after Chapter 13 bankruptcy discharge in certain cases. If you (a) paid back 70% of your unsecured debts, (b) your plan was proposed in good faith and (c) you used your best effort to pay your debt.
Contact Parker & DuFresne Today
Facing the decision to file for Chapter 7 or Chapter 13 bankruptcy is already a difficult one. You don’t want to make it more difficult by having your bankruptcy denied by the courts.
The right counsel and representation will work with you to ensure it that doesn’t happen. At Parker & DuFresne, we represent clients in the Northeast Florida area, including Jacksonville, St. Augustine, Orange Park and the beaches, and we can help safely guide you through the bankruptcy process. Contact our offices for a free consultation today.