If you have previously filed for bankruptcy and are facing financial difficulties once more, you might be wondering about the possibility and implications of filing again. Here’s a comprehensive guide to understanding how a second bankruptcy works and what you need to know before taking this step. For personalized assistance, contact Law Offices of Terrence Fantauzzi at (909) 552-1238 for a free consultation.
Frequency of Second Bankruptcies
While many people successfully navigate their first bankruptcy and regain financial stability, some may find themselves in need of filing again. Statistics show that up to 10% of those who file for bankruptcy once will do so again. It is legally permissible to file for bankruptcy multiple times, but certain rules and waiting periods apply before you can receive a discharge again.
Waiting Periods Between Bankruptcies
Chapter 7 to Chapter 7
If your previous bankruptcy was a Chapter 7, you must wait eight years from the original filing date before you can file another Chapter 7 and receive a discharge. It’s important to note that while you can file immediately after your previous discharge, you won’t be eligible for a discharge until the eight-year period has passed.
Chapter 13 to Chapter 13
For Chapter 13 bankruptcy, the waiting period is shorter. You must wait at least two years from the original filing date to file another Chapter 13 case and be eligible for a discharge. This is because Chapter 13 involves a repayment plan, and debtors typically have more financial resources.
Filing a Different Chapter of Bankruptcy
Chapter 7 Followed by Chapter 13
If you initially filed for Chapter 7 and are now considering Chapter 13, the waiting period is four years from the original filing date of your Chapter 7 case. This allows time for the discharge from the Chapter 7 to take effect before entering a new repayment plan under Chapter 13.
Chapter 13 Followed by Chapter 7
If your first bankruptcy was a Chapter 13 and you wish to file for Chapter 7 next, the waiting period is six years from the original Chapter 13 filing date. However, exceptions may apply if you have paid at least 70% of your debt in good faith under your Chapter 13 plan.
Impact on Credit and Public Record
A second bankruptcy will appear on your credit report and can remain there for up to 10 years, similar to your first bankruptcy. This means you could have two bankruptcies affecting your credit score simultaneously. However, your credit score can begin to improve after your discharge as you responsibly manage your finances and rebuild your credit profile.
Steps Before Filing Again
Before filing for bankruptcy again, you must complete mandatory credit counseling. This is a crucial step to ensure you understand your options and the consequences of filing for bankruptcy. Ignoring mounting debt is not a solution and can lead to severe legal and financial repercussions. Instead, seek guidance from a qualified bankruptcy attorney to navigate the process effectively.
Seeking Professional Help
Filing for bankruptcy is a significant financial decision, whether it’s your first, second, or subsequent time. At Law Offices of Terrence Fantauzzi, our experienced bankruptcy attorneys can help you understand your options and guide you through the process. Contact us at (909) 552-1238 for a free consultation to discuss your financial situation and determine the best course of action.