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For those deep in debt that have tried all other ways to deal with what they owe but just can’t, bankruptcy may be the option of last recourse. But even after filing bankruptcy, things may not go as you hoped. We see some people that have come to us and want to try and pay off their debts, so they opt for a Chapter 13 to give them time to reorganize their debts. Sometimes, this doesn’t work out and the repayment plan isn’t completed or people make mistakes and sabotage their bankruptcy. But this doesn’t mean the end to their money woes.
Depending on the circumstances, we may recommend converting the case to a Chapter 7. Or, if it’s been too long between cases to convert, we may advice that we simply file a new bankruptcy case and make it a Chapter 7 so that most unsecured debts can be discharged. Sometimes, a Chapter 7 or Chapter 13 may be filed subsequent to each other to get the optimal debt relief for consumers who may struggle after just one filing. There are laws that govern subsequent filing and today we take a look at what’s allowed…
Rules on Subsequent Chapter 7 Bankruptcies
If you filed a Chapter 7, completed all the steps and received a discharge, you have to wait eight years before you can file another Chapter 7. Interestingly, the laws on repeat filings relate to discharges rather than filings. To clarify, you can file a Chapter 7 but never complete the steps required to obtain a discharge or fail to pay your attorney or do anything else that results in a dismissal rather than discharge and file for Chapter 7 again after a short waiting period.
If your Chapter7 bankruptcy was dismissed for any of the following reasons, there may be a 180 day (six month) waiting period imposed before you can refile a Chapter 7:
- Failure to follow a court order
- Failure to appear in court
- After a creditor failed a motion for relief from the bankruptcy stay, you dismissed the case yourself
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Rules on Subsequent Chapter 13 Bankruptcies
If you filed a Chapter 13 and completed the repayment plan and got a discharge, you could subsequently file a second Chapter 13 after two years had passed from the date you filed the initial Chapter 13. For instance, if you file Chapter 13 and are put on an 18 month repayment plan, complete the plan and receive a discharge but still have some debts that you hope for further relief on, you could file another Chapter 13 six months after your discharge under the first Chapter 13.
The same caveats apply to a Chapter 13 as they do for a Chapter 7 if your case was dismissed without discharge. For the same reasons listed above, you may be subject to a six month waiting period before you can refile your Chapter 13 case.
Rules on Filing Chapter 7 After Chapter 13
If you filed a Chapter 13, completed your repayment plan and received a discharge and then want to file a Chapter 7, you can file a Chapter 7 but won’t be eligible to receive a discharge. Only Chapter 7 cases filed six years after the Chapter 13 discharge are eligible for a discharge unless you either paid all your unsecured creditors in full or paid at least 70% of your creditors under a good faith plan.
Rules on Filing Chapter 13 After Chapter 7
If you filed Chapter 7 and received a discharge, you cannot receive a discharge on a Chapter 13 unless you wait four years from the date the Chapter 7 was originally filed. In some cases, your attorney may recommend you file a Chapter 13 immediately after your Chapter 7 for a specific purpose. For instance, if you need time to pay a debt and want to use Chapter 13 strictly for a circumstance such as saving your home from foreclosure. This is informally known as a “Chapter 20” while back-to-back Chapter 13 filings are known as a “Chapter 26”.
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If you’ve filed bankruptcy before and received a discharge, but need more help with your debts, or if you have filed a bankruptcy that was dismissed and are ready to file again and follow through all the way to discharge so you can enjoy the benefits of the financial fresh start that bankruptcy can offer, contact the law offices of John T Orcutt today for a free consultation!