While you can file for bankruptcy any time you want, if you previously filed and received a discharge, you must wait a specific period of time before filing bankruptcy a second time, at least if you want to receive a discharge, that is.
Believe it or not, in some situations filing for bankruptcy twice without receiving a discharge makes sense, but not for most people. Also, problems can arise from filing a second bankruptcy prematurely. The consequences can be disastrous.
Once you file a Chapter 7, you cannot automatically “dismiss” the petition. This has the effect of turning your property over to a bankruptcy trustee whose job it is to liquidate it at fire-sale prices for the benefit of your creditors. However, receiving a nominal reduction of outstanding debts is not a good outcome for most.
Timing is everything when it comes to filing bankruptcy twice. Waiting periods applicable to filing for bankruptcy a second time are discussed below.
1. When you originally received a Chapter 7 discharge and plan to file Chapter 7
If you previously filed a Chapter 7 bankruptcy, you must wait eight years before filing to be eligible for discharge. Pursuant to Bankruptcy Code section 727(a)(8), this is calculated from the original filing date to the filing of the second petition. For example, if you originally filed your return on January 1, 2000, you’ll want to wait until January 1, 2008 or later.
2. When you originally received a Chapter 7 discharge and plan to file Chapter 13
Pursuant to Bankruptcy Code section 1328(f)(1), if you previously filed a Chapter 7 bankruptcy and received a discharge, you must wait four years before filing a Chapter 13 bankruptcy to be eligible for a discharge.
If a Chapter 13 plan is not confirmed, a bankruptcy trustee may recommend conversion to Chapter 7. However, the rule that you cannot receive a second Chapter 7 discharge before eight years have elapsed from the previous filing of the Chapter 7 Chapter 7, so in most cases you’ll want to discard the Chapter 13 action rather than convert it to Chapter 7.
3. When you originally received a Chapter 13 discharge and plan to file Chapter 7
Under section 727(a)(9) of the Bankruptcy Code, if you received a Chapter 13 discharge, you are not eligible for a Chapter 7 discharge for another six years, subject to some exceptions.
4. When you originally received a Chapter 13 discharge and plan to file Chapter 13
Pursuant to Bankruptcy Code section 1328(f)(2), if you received a discharge in the original Chapter 13, you cannot receive another discharge until two years have passed.
5. When you submitted any chapter but did not receive a download
In most cases, you can file again after waiting 180 days. In such cases, it is important to speak with an attorney familiar with bankruptcy law.
The bottom line is that while it’s not unusual to file for bankruptcy a second time, timing is crucial when you want to receive a second discharge.