There is no limit on the number of times a person can file for bankruptcy, but there is a “cooldown” period someone must wait before they can file for bankruptcy again.
The cooldown period lasts between two and eight years, depending on whether the first bankruptcy was Chapter 7 or Chapter 13 and the type of the intended bankruptcy filing.
When Can I File for Bankruptcy Again?
If you need debt relief from bankruptcy again, you must ensure that enough time has elapsed since your previous filing date – not your discharge date.
Here’s how long you must wait before filing another bankruptcy petition:
- 2 years: When you previously filed for Chapter 13 and intend to file for Chapter 13 again
- 4 years: When you previously filed for Chapter 7 and intend to file for Chapter 13
- 6 years (at most): When you previously filed for Chapter 13 and intend to file for Chapter 7
- 8 years: When you previously filed for Chapter 7 and intend to file for Chapter 7 again
There’s an important exception that can apply to those who previously filed for Chapter 13 and fully paid off their unsecured creditors (creditors who don’t hold a claim on collateral such as a vehicle or real estate). These filers may not have to wait a full six years before they can file again. Likewise, filers with a similar profile but who paid at least 70% of their unsecured debts and made good-faith efforts to deal with their debt may not have to wait as long.
What Is “Chapter 20” Bankruptcy?
There is no such thing as Chapter 20 in the U.S. bankruptcy code. Instead, “Chapter 20” is an informal name given to the practice of filing for Chapter 13 as soon as a Chapter 7 case concludes. This strategy might benefit those who have a lot of debt and not enough time to deal with it.
Filing for Chapter 7 can help someone reduce their overall debt burden to a size that qualifies them for Chapter 13. While they won’t get a discharge in Chapter 13, a debt reorganization plan lasting an additional three to five years can give them just enough time to cure arrears on auto loans, mortgages, and other secured debts that weren’t eligible for Chapter 7 discharge.
Contact Us for Legal Assistance
Although you might not need to file for bankruptcy again, it’s helpful to know that it’s there if you need it again. You may need to wait a while before you can file again, but there exists no limit on how many times someone can seek bankruptcy debt relief.
If you are thinking about filing for bankruptcy again, we at Nguyen Law Group can help. Contact us online to learn more.