In this article, we will address the topic of re-filing for bankruptcy after previously filing a request. We will discuss the time that must pass before you can submit a new request and the restrictions imposed on it. We will also talk about the automatic stay period and how it is applied in the case of re-filing.
How much time must pass between filing my bankruptcy petitions?
There is a good chance of filing for bankruptcy after a previous petition. The time that must pass before this depends on the type of case you filed previously and what you plan to file this time. It also depends on whether the previous case led to a discharge. A discharge releases the debtor from personal liability for any debts listed in the bankruptcy case. If the previous case was closed without a discharge, you can file a new request immediately, provided there are restrictions. A bankruptcy case is closed when the judge or trustee closes your case before it is completed.
After closing a Chapter 13 case
Suppose an event occurs that prevents you from making the payments on your repayment plan in a Chapter 13 case. Typically, you will not be granted a discharge from your debts unless you qualify for a hardship discharge. Instead, your case will be closed.
If your Chapter 13 case is closed, you can file a new case immediately. For strategic reasons, some debtors may file multiple cases and close them in quick succession. This is not necessarily a good idea, but it is possible.
A debtor, facing a threat to their property, files for bankruptcy to stop repossession or legal action. When the threat ends, the debtor will request the court to close the case or, more likely, stop making payments, leading to the closure of the case.
When the creditor resumes collection efforts, the debtor files a new case. To combat debtors who play the system in this way, Congress included provisions in the Bankruptcy Act allowing debtors to file new cases. However, the bankruptcy law also limits how a debtor can use the automatic stay in such cases.
Multiple bankruptcy cases within 12 months
One of the duties of the bankruptcy judge or trustee is to protect bankruptcy courts from serial filers. Although there is no specific timeframe laid out in the bankruptcy law, this decision is made by the prior judge or trustee on a case-by-case basis. Some of the most common scenarios include:
One case pending within 12 months
If you have a previous bankruptcy case pending within the last 12 months that was dismissed, you will likely be able to file a second case, but the automatic stay will only last for 30 days in the latter case. Creditors will have to stop collection actions, but only for 30 days. After that, the automatic stay will end naturally unless you obtain court approval to extend it.
Two cases pending within 12 months
If you have two cases pending within the last 12 months, you may be allowed to file a third case, but the automatic stay will only come into effect if you request the court to impose it.
To determine whether you qualify for the automatic stay, the court will consider several factors, including:
- The number of cases you have filed
- Whether your cases were dismissed due to non-payment, error (whether it was your error or your attorney’s), failure to file necessary paperwork, or failure to cooperate with the trustee
- Whether you closed your case after a creditor filed a request to lift the automatic stay (typically requesting permission to repossess a car or eviction proceedings from a home)
- What
- If your circumstances have changed since closing your previous case
Example of Serial Filing
Even if your previous cases are more spread out over more than 12 months, you may not be free from problems. Your bankruptcy trustee, the U.S. Trustee’s Office (part of the Department of Justice), and your creditors will scrutinize all your previous cases to determine if you are trying to take advantage of the system. For example:
Dave and Margaret filed a Chapter 13 case in 2018. This was not their first case. Their previous cases include:
- Chapter 7 case in 2011: Discharged
- Chapter 13 case in 2013: Case was dismissed due to plan payment defaults
- Chapter 13 case in 2016: Case was dismissed due to failure to file required documents
In each instance, the automatic stay was not affected, but after the last case was filed, the Chapter 13 trustee requested the court to lift the stay due to serial filing. Dave and Margaret may have to go to court and testify about the reasons for filing and dismissing both of their previous Chapter 13 cases. If the court allows the new case to proceed, it is likely contingent upon the condition that if the new case is dismissed, the couple will not be allowed to file a new case for a period of time, which is usually a year or more.
If their actions particularly disturbed the court, the court may dismiss the case immediately with a provision barring them from re-filing for a period of time. In some egregious cases, courts may permanently bar the debtor from filing another bankruptcy case.
Was this information helpful?
Thanks for your feedback!
Sources:
- Congressional Research Service. “Bankruptcy Basics: A Primer,” Pages 6-8.
- United States Courts. “Discharge in Bankruptcy – Bankruptcy Basics.”
- United States Bankruptcy Court, Central District of California. “Dismissal, Conversion & Closing of a Bankruptcy Case, What Are the Differences Between Them?”
- Cornell Law School Legal Information Institute. “11 U.S. Code § 362. Automatic Stay.”
Source: https://www.thebalancemoney.com/if-i-filed-bankruptcy-before-how-soon-can-i-file-again-316173
Leave a Reply