Can a Person File Bankruptcy Twice?
While you may file for bankruptcy any time you wish, if you before filed and received a release, you must wait a stated period of time before filing bankruptcy a second time – at the minimum if you wish to receive a release, that is.
Believe it or not, in some situations, filing bankruptcy twice without receiving a release makes sense – but not for most people. Additionally, problems can arise when filing a second bankruptcy prematurely. The consequences can be disastrous.
Once you file a Chapter 7, you can’t automatically “dismiss” the appeal. This has the effect of handing over your character to a bankruptcy trustee whose job it is to liquidate it at fire sale prices for the assistance of your creditors. However, receiving a moderate reduction of nevertheless-noticeable debts is not a good consequence for most.
Timing is everything when it comes to filing bankruptcy twice. The waiting periods applicable to filing bankruptcy a second time are addressed below.
1. When Originally Received a Chapter 7 release and Plan to File Chapter 7
If you before filed a Chapter 7 bankruptcy, you must wait eight years before filing to be eligible for release. Pursuant to Bankruptcy Code section 727(a)(8), this is calculated from the original filing date to the filing of the second appeal. For example, if you originally filed on January 1, 2000, you would want to wait until January 1, 2008, or later.
2. When Originally Received a Chapter 7 release and Plan to File Chapter 13
Pursuant to Bankruptcy Code section 1328(f)(1), if you before filed a Chapter 7 bankruptcy and received a release, you must wait four years before filing a Chapter 13 in order to be eligible for a release.
If a Chapter 13 plan is not confirmed, a bankruptcy trustee may recommend conversion to Chapter 7. The rule stating that you cannot receive a second Chapter 7 release before eight years elapses from the prior Chapter 7 filing nevertheless applies, however, so in most situations you will want to dismiss the Chapter 13 action instead of transform to a Chapter 7.
3. When Originally Received a Chapter 13 release and Plan to File Chapter 7
Under Bankruptcy Code section 727(a)(9), if you received a release in the Chapter 13, you are not eligible for a release under Chapter 7 for another six years, unprotected to a few exceptions.
4. When Originally Received a Chapter 13 release and Plan to File Chapter 13
Pursuant to Bankruptcy Code section 1328(f)(2), if you received a release in the original Chapter 13, you cannot receive another release until two years has passed.
5. When Filed any Chapter but Didn’t Receive a release
In most situations, you can file again after waiting 180 days. In such situations, it is important to speak with an attorney familiar with bankruptcy law.
The bottom-line is that while it is not uncommon to file bankruptcy a second time, timing is crucial when you wish to receive a second release.