Bankruptcy Law

Can You File for Bankruptcy Multiple Times?

When you filed for bankruptcy the first time, you probably didn’t think about doing it again. But if an unexpected illness or job loss has changed your financial situation, you may be thinking about filing a second bankruptcy petition.

If you’re wondering whether you can file for bankruptcy a second time, there’s good news. Federal law says that you can file for bankruptcy as many times as you like. But the decision to file a second bankruptcy raises many questions. This article addresses some common questions about filing a second bankruptcy. Because these issues can be complicated, please consider speaking to a bankruptcy attorney near you to discuss your unique case.

Chapter 7 vs. Chapter 13

Bankruptcy helps you reduce or cancel your debts, giving you a fresh start. The most common bankruptcies for individuals are Chapter 7 and Chapter 13. These names come from Chapter 7 and Chapter 13 of the U.S. Bankruptcy Code.

Bankruptcy lawyers call Chapter 7 bankruptcies “liquidation bankruptcies.” In a Chapter 7, the bankruptcy trustee helps you sell items that don’t qualify for property exemptions under bankruptcy law. That money goes to your creditors.

The bankruptcy process under Chapter 13 filings works in a slightly different way. In a Chapter 13 “reorganization bankruptcy,” you enter a repayment plan. The plan gives filers three to five years to repay a share of their debts.

Under either Chapter 7 or Chapter 13, a successful bankruptcy filing ends with a discharge. A bankruptcy discharge order reduces or eliminates your debts.

Can I File for Bankruptcy More Than Once?

Generally, the answer is “yes.” Federal bankruptcy law does not limit the number of times a person can file for bankruptcy. So, most people can file as many Chapter 7 or Chapter 13 bankruptcy petitions as they like.

How Long Will I Have to Wait to File a Second Bankruptcy?

There are two answers to this question. The easy answer is that the waiting period depends on the type of bankruptcy you filed in your previous bankruptcy case and the type of bankruptcy you want to file now. The table below lists the current waiting periods for most cases. (Note: The waiting period starts on the filing date of the first bankruptcy, not the date that it was discharged.)

Previous filingCurrent Filing Waiting Period
Chapter 13Chapter 13Two years
Chapter 7Chapter 13Four years
Chapter 13Chapter 7Six years
Chapter 7Chapter 7Eight years

There are some exceptions to the general wait time rules. For example, if you want to file a Chapter 7 petition after filing a Chapter 13, you may not have to wait the full six years to file a new case. If you can show that you have either: 1) paid 100% of your unsecured debts under your Chapter 13 payment plan, or 2) paid at least 70% of the unsecured debts in a “best efforts” approach under the plan, you can file a new bankruptcy case immediately.

Additionally, bankruptcy courts dismiss petitions for many reasons. A dismissal can be “with prejudice” or “without prejudice.” If your first case was dismissed without prejudice, you can refile it at any time with no waiting period.

But if your case was dismissed with prejudice because you purposefully ignored court orders, missed court dates, or filed to manipulate the automatic stay process, the court can make you wait 180 days before refiling.

Can I Be Stopped From Filing for Bankruptcy a Second Time?

Bankruptcy courts expect filers to act in “good faith.” A person who acts in good faith behaves in an honest and reasonable manner.

Though there is some debate, most courts agree that a bankruptcy court can permanently forbid borrowers who act in bad faith from filing any future bankruptcies. Hiding assets, failing to comply with court deadlines, or filing multiple bankruptcies to take advantage of the debt relief process is not acting in good faith.

Will Filing a Second Bankruptcy Affect My Credit?

Chapter 13 bankruptcies stay on your credit report for seven years. Chapter 7 bankruptcies show up for 10 years. So, back-to-back bankruptcies could impact your credit score for nearly two decades. The long-term impact on your credit score is something to consider before filing a second bankruptcy.

Ask a Bankruptcy Attorney About Filing a Second Bankruptcy

Filing a second bankruptcy is a serious decision. If you’re wondering if it’s the right choice for you, speak to a bankruptcy attorney near you. An experienced bankruptcy lawyer who knows the law can review your financial situation and help you make the decision that’s right for you.

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