The past decade or so has been pretty rough on the economy. If you filed for bankruptcy during the worst years of the recession (or at any other time) and have found yourself struggling with bills again, you may be wondering if you can declare bankruptcy more than once. A renowned Houston bankruptcy attorney wants to help you answer that question with this article.
Can You Declare Bankruptcy More Than Once?
The short answer is that yes, you can declare bankruptcy more than once. The long answer is that there are waiting periods and other limitations before you can file a second bankruptcy. Bankruptcy also may not be the best solution for your problem, so you should look for and seriously consider other, less extreme options to help relieve your debt load.
How Long Are the Waiting Periods?
Thanks to 2005 changes to the Bankruptcy Code, the length of time you have to wait after one bankruptcy before you can file another depends on what type of bankruptcy you had before and what type of bankruptcy you intend to file now.
When people think about bankruptcy, they typically think about Chapter 7 bankruptcy. This is a discharge of all eligible debts, including credit card debt and hospital bills. Not all debts can be discharged, however. Tax debts, child support, and student loans are examples of debts that can’t be discharged in a bankruptcy and must be repaid.
If you previously filed a Chapter 7 bankruptcy, you must wait at least 8 years before filing another Chapter 7 bankruptcy.
Chapter 13 bankruptcy involves restructuring your debt and helps you repay your creditors with monthly payments over the course of three to five years as low as $125-150 that get distributed amongst all of your creditors. It does not eliminate your debt; Chapter 13 bankruptcy simply makes it easier to repay your debt.
Anybody who previously filed a Chapter 7 bankruptcy must wait 4 years before filing for Chapter 13 bankruptcy.
If you previously filed for Chapter 13 bankruptcy and plan to file for Chapter 7 bankruptcy, you must wait 6 years.
Those who previously filed for Chapter 13 bankruptcy and wish to file for Chapter 13 again only need to wait 2 years before filing again.
What if Your Previous Bankruptcy was Dismissed Rather Than Discharged?
If there was a problem with your previous bankruptcy and the case was dismissed rather than having your debts discharged, you may refile your bankruptcy case, although you may need to wait 180 days first. Unfortunately, the refiled bankruptcy can likely only include new debts and nothing that was included in your original bankruptcy filing.
Is Chapter 13 Bankruptcy a Better Option for me Than Chapter 7?
If you have a lot of debts that can’t be discharged by a Chapter 7 bankruptcy, it may be worth it to go through the restructuring process of Chapter 13 bankruptcy. Chapter 13 bankruptcy can help you get caught up on your bills without having your home foreclosed or your car repossessed. It can also help you repay tax debt without having your wages garnished.
Should You Declare Bankruptcy More Than Once?
Just because you may declare bankruptcy more than once doesn’t mean that you should. A bankruptcy stays on your credit report for 10 years, which can make it more difficult to get credit cards, a mortgage, a car loan, an apartment, or even a job. That’s a high price to pay when there may be other, more appropriate options.
Many creditors will be happy to work with you to arrange payment plans. After all, they would rather get their money back a little at a time than not at all. There may also be other ways to reduce your level of debt and make paying it back less stressful. You should contact a local bankruptcy attorney to determine whether or not you would benefit from another bankruptcy or if there is a better option for your particular situation.
As you can see, it is possible to file for bankruptcy more than once, but it isn’t always in your best interest to do so. Most bankruptcy attorneys offer free consultations; take advantage of that fact to visit a few different bankruptcy lawyers to see what sort of other solutions may be available to help you improve your situation. Bankruptcy should generally be considered a last resort rather than a go-to option.