Let’s Ask ESSER: If I filed for bankruptcy before, may I file again?

Q:
If I filed for bankruptcy before, may I file again?
– Kyle in Milwaukee

A:

Since 1982, multi award winning attorney Todd C. Esser has been leading the field, serving the community, and helping consumers just like you achieve success through trying financial times.

Yes, relief under the bankruptcy code is available to someone who may have filed in the past. In order to qualify for a discharge under Chapter 7 of the bankruptcy code, you must wait eight (8) years from the date, of the filing of the petition, in the prior case.

However, Chapter 13 is available at any time! If someone has filed for and received a discharge in a prior Chapter 7, in order to receive a discharge in a subsequently filed Chapter 13 case, they will need to wait more than four (4) years from the date of the petition in the prior Chapter 7 case. That person is still eligible to file a Chapter 13 and, in fact, a Chapter 13 petition could be filed days after the discharge is granted in the prior Chapter 7 case.

This type of situation is generally referred to as a “no discharge” Chapter 13 filing. However, it is often used by individuals to prevent foreclosure of a house, or repossession of a car, or to prevent tax levy of wages. The creditor is still affected by the automatic stay in the subsequently filed Chapter 13 case and is bound by the terms of the order confirming the plan of arrangement. For instance, if a creditor is attempting to foreclose a house, a subsequently filed no discharge Chapter 13 would still have the effect of stopping the foreclosure, reinstating the mortgage note and allowing the homeowner to pay the mortgage arrearage, costs and attorney fees from the foreclosure, over a repayment term of up to five (5) years. The effect would be to reinstate the mortgage loan and commence regular payments as if no payment had been missed in the first place.

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