The US bankruptcy system provides invaluable tools for struggling borrowers who find themselves in the midst of a financial crisis. With the help of an experienced attorney, a chapter 13 bankruptcy can help you catch up on your mortgage and car loan payments, discharge unsecured debts, and put an immediate stop to all collection activities. However, to prevent borrowers from abusing the systems, the law places strict restrictions on those who seek to file for chapter 13 protection multiple times.

Filing for Chapter 13

If your chapter 13 case has been successfully discharged, the code requires you to wait at least two years from the initial filing date to file another petition. However, because chapter 13 payment plans typically take three to five years, most borrowers are eligible to file as soon as their first case is discharged. In most cases, you can usually file another petition immediately if your case has been dismissed, although there are some exceptions.

Restrictions on Re-Filing

If the court determines that you’re abusing the bankruptcy system, they may block certain elements of your petition or prevent you from filing for bankruptcy protection altogether. In one case, for example, the petitioner had received and disposed of a $25,000 settlement, without paying back their creditors or bankruptcy estate. When the debtor requested a dismissal and expressed their intention to file again, the court ruled that any debts dismissible in the previous bankruptcy could not be included in the new one.

The Automatic Stay

Filing repeat petitions also impacts the automatic stay included in a bankruptcy. In particular, if your case was dismissed and you file another within one year, the automatic stay will be limited to 30 days. Most attorneys recommend requesting an extension of the stay in your current order instead, helping you avoid potential foreclosures and repossessions.

The Bueker Law Firm is an accomplished legal office focused on providing borrowers throughout the Little Rock, AR, area with high-quality chapter 13 bankruptcy services. If you’ve fallen behind on your debts, visit their website to see how they can help, follow their Facebook for more advice, or call (870) 673-1313 to speak with a skilled bankruptcy attorney.