The purpose of filing for bankruptcy is to give you a second chance in life to make responsible financial decisions, and to use credit sensibly. The new requirement for pre-filing credit counseling and post-discharge debtor education aims to educate people in the proper management of their finances.
Not everyone learns from their mistakes though, so the courts will entertain more than one bankruptcy petition from the same person during their lifetime. In fact, there\’s no upper limit to the number of times you can file for bankruptcy and obtain a discharge. There are, however, time limitations on how frequently you can file for bankruptcy.
Chapter 7
You cannot file for an additional Chapter 7 for at least eight years from the date of your first filing. The reason you\’re required to wait so long between Chapter 7 filings is that they allow for a discharge of your total personal debt.
Chapter 13
Anyone who has completed a Chapter 13 filing must wait at least two years before filing for Chapter 13 protection again. Most filings of this type take between 3 – 5 years to complete, so you would need to wait for your first discharge to be fully cleared before being granted another one.
Now you’re probably wondering would happen if you had previously applied for a Chapter 7 discharge, but now wanted to file for a Chapter 13 instead. You\’re not the first person to ask that question, so here\’s a breakdown of how it works:
Chapter 7 to Chapter 13
You must wait at least four years after the discharge of your Chapter 7 filing before being eligible to file for Chapter 13 bankruptcy.
Chapter 13 to Chapter 7
If after filing for Chapter 13 bankruptcy you then wish to file for Chapter 7 you must wait six years before you can receive a discharge of your debts. The six year limitation can be removed if you have already repaid at least 70% of your debt.
Limitations
If you have abused, or attempted to manipulate, the bankruptcy system, then you may have had a bankruptcy petition dismissed with prejudice. If this is the case you will probably find that most courts will prohibit you from filing for bankruptcy for far longer than six or eight years, and in some cases will bar you from filing for bankruptcy ever again. A minimum exclusion of 180-days will apply in most cases where you\’ve been seen to willfully disobey court orders and/or abuse the bankruptcy system.
Chapter 20 Bankruptcy
There are certain situations where filing for a Chapter 13 immediately after being granted a Chapter 7 discharge might be of benefit to you. The protection offered by a Chapter 13 bankruptcy would allow you time to catch up with other personal debts, such as outstanding mortgage payments, while being protected from your creditors by your Chapter 13 filing.
Exemptions
If, for whatever reason, your original petition for a discharge of your debts wasn\’t granted, then you can file for a Chapter 7 or Chapter 13 bankruptcy without having to wait. The waiting periods only apply to people who have successfully had their debts discharged with a previous bankruptcy filing.