Filing a bankruptcy case gives you a fresh start to recover after a financial crisis without the burden of debts you cannot pay hanging over your head. By filing a Chapter 7 or Chapter 13 bankruptcy case, you can get out of debt, protect retirement savings, and keep your property. In most cases, debtors can eliminate most, if not all, unsecured debts without losing any property.
While filing a bankruptcy case is usually not as stressful or difficult as many people believe, the process is not something that most people want to repeat. However, lawmakers realize that some individuals may experience more than one financial crisis during their lifetime that requires the assistance of the bankruptcy court to resolve. Therefore, lawmakers included a provision within the Bankruptcy Code that allows debtors to file bankruptcy again if they find themselves in another financial situation in which they cannot pay their debts.
However, filing a bankruptcy case and receiving a bankruptcy discharge are two separate matters. The distinction between a bankruptcy filing and a bankruptcy discharge becomes very important when you are considering filing bankruptcy again
Why Do People File For Bankruptcy Relief A Second Time in Florida?
Individuals throughout Florida file for bankruptcy relief for numerous reasons. Regardless of the underlying reason for filing a Chapter 7 or a Chapter 13 case, the common factor in all cases is that the person cannot afford to pay his or her debts. Reasons, why a person cannot afford to pay debts, include:
- Periods of unemployment
- A long-term reduction in income
- The death of a spouse
- Divorce or separation
- Loss of a business or downturn in business
- A sudden illness or accidental injury
- Overuse of credit cards
- Poor financial management
Many different life events can precipitate the filing of a Chapter 13 or a Chapter 7 case. Unfortunately, someone may experience several financial hardships. While some financial hardships may not require filing for bankruptcy relief, a person may find that he or she needs to file another bankruptcy case.
For that reason, the Bankruptcy Code does not prevent a person from filing bankruptcy again, but it does limit the number of bankruptcy discharges a person can receive during a specific period.
What is a Bankruptcy Discharge?
The goal of filing a Chapter 7 or Chapter 13 case is to obtain a bankruptcy discharge. The bankruptcy discharge eliminates your legal responsibility to repay a discharged debt. Creditors are prohibited by law from taking any actions to collect a discharged debt, including wage garnishments, filing debt collection lawsuits, or sending collection letters.
If you file a bankruptcy case but do not receive a bankruptcy discharge, your legal liability to repay debts remains and your creditors may continue legal actions to collect the debt when the bankruptcy case is closed. Therefore, filing a Chapter 7 or Chapter 13 case without receiving a bankruptcy discharge is useless if your intention is to get out of debt.
Filing Bankruptcy Again vs. Receiving Another Bankruptcy Discharge
There are no restrictions on the number of bankruptcy cases you can file or when you can file another bankruptcy case within the Bankruptcy Code. However, it does limit the number of bankruptcy discharges you may receive during a certain period. The easiest way to remember when you are eligible for another bankruptcy discharge is to use the 2-4-6-8 Rule.
How Often Can I File Bankruptcy?
The 2-4-6-8 Rule helps you remember how long you must wait between bankruptcy filings to receive another bankruptcy discharge. Below are the time frames for receiving another bankruptcy discharge:
- How long must I wait to file another Chapter 13 case after a prior Chapter 13 case?
The time you must wait between Chapter 13 cases is two years to be eligible to receive another bankruptcy discharge by filing Chapter 13 again.
- How long must I wait to file a Chapter 13 case after a prior Chapter 7 case?
If your previous bankruptcy case was filed under Chapter 7, you must wait four years between filings to receive a bankruptcy discharge under a new Chapter 13 case.
- How long must I wait to file a Chapter 7 case after a prior Chapter 13 case?
If your previous bankruptcy case was filed under Chapter 13, you must wait six years before filing a Chapter 7 case to be eligible to receive a bankruptcy discharge.
- How long must I wait to file another Chapter 7 case after a prior Chapter 7 case?
The time you must wait between Chapter 7 caseshttps://www.law.cornell.edu/uscode/text/11/727 is the longest to receive another bankruptcy discharge. You must wait eight years between Chapter 7 bankruptcy cases to be eligible for another bankruptcy discharge under Chapter 7.
In some cases, factors may complicate the calculation of the time required between bankruptcy filings to receive a bankruptcy discharge. For instance, your circumstances might qualify you for a hardship discharge even though the time between bankruptcy files does not meet the requirements under the 2-4-6-8 Rule.
It is best to consult an experienced Orange Park bankruptcy attorney if you believe you need to file bankruptcy again. A Florida bankruptcy lawyer can analyze your current financial situation, explain your various bankruptcy and non-bankruptcy options for debt relief, and help you choose the best debt
relie foption for you.
Contact a Bankruptcy Attorney in Orange Park for a Free Case Review
The decision to file a Chapter 13 or a Chapter 7 bankruptcy case should only be made after careful consideration of all debt relief options. If you are struggling to pay debts each month, filing for bankruptcy relief may give you the fresh start you need to recover after a financial crisis.
Bankruptcy Attorney Tony Turner represents individuals, couples, and businesses in Orange Park, Jacksonville, Lake City, Deland, Augustine, and the surrounding areas as they seek affordable solutions to debt problems.
If you are ready to explore bankruptcy options to get rid of debt, contact The Law Office of Tony Turner by calling (904) 679-2020 or by using the online form to schedule your free consultation with a Florida bankruptcy lawyer.