What if you have to file bankruptcy again?

If you find yourself in a situation again where a bankruptcy filing is the only route to fix the financial problem, yes you can file again. Bankruptcy can be filed any number of times, but the biggest hurdle you will face is whether you will get a discharge.

A Chapter 7 case cannot be filed again until 8 years have passed since the first case was filed. However, if need, a debtor can file a Chapter 13 case should he have some secured debt that needs to be taken care of. It is possible for a debtor to file a Chapter 13 the day after the Chapter 7 case has been discharged and closed. The only issue is that a debtor will not receive a discharge. This may not be a problem since most Chapter 13 cases following a Chapter 7 are to take care of mortgage arrears that could not be handled in the Chapter 7 case. Since most, if not all, of the debtors unsecured debts have been discharged, cash flow to fund a Chapter 13 case becomes somewhat easier. Other types of debts that can be paid in a Chapter 20 (not a real Chapter but it is known as a Chapter 7 followed by a Chapter 13). Tax debt that was not discharged in the Chapter 7 or maybe some student loans that could now be paid to or even paid off. The debtor will have 3 to 5 years to pay on those non-discharged debts.

Here are the time frames between cases where dischargeability is an issue:

8 years between Chapter 7 cases – 727(a)(8)
2 years between Chapter 13 cases – 1328(f)(2)
4 years between Chapter 7 and Chapter 13 – 1328(f)(1)
6 years between Chapter 13 and Chapter 7(if under 70% plan( – 727(a)(9)

It should be noted that the time is counted from filing to filing – not from discharge to second filing.
So, if a debtor finds himself in another situation where bankruptcy may be the only way out, don’t despair, there may be a way to handle the situation and get the relief you need.