Every year, thousands of people file for bankruptcy. Bankruptcy is a process that allows people to discharge many overwhelming financial obligations. Some of the most common reasons people file for bankruptcy include credit card debt, medical bills, divorce and job loss.
There are two popular forms of consumer bankruptcy: Chapter 7 and 13. Chapter 7 bankruptcy allows people to resolve debts within only a few months after filing. In very few cases, the filer’s assets may be liquidated to resolve unresolved debts. Chapter 13 bankruptcy is a process that allows people with regular income to restructure their debts, making their debts easier to pay. After three to five years, the remaining debts may be resolved.
Unfortunately, many debtors may encounter repeated financial difficulties and need to file for bankruptcy again. Is it possible to file for Chapter 7 or Chapter 13 bankruptcy again? Here is what you should know:
How often can you file for bankruptcy?
People can file for bankruptcy as many times as they wish. However, there are some limitations. People who have filed for bankruptcy in the past may need to wait several years before they can file for bankruptcy again. The amount of time filers may need to wait often depends on the type of prior bankruptcy and the new bankruptcy filing. Here is how long debtors may need to wait:
- Chapter 7 to a Chapter 7 bankruptcy: 8 years
- Chapter 13 to a Chapter 7 bankruptcy: 6 years
- Chapter 7 to a Chapter 13 bankruptcy: 4 years
- Chapter 13 to a Chapter 13 bankruptcy: 2 years
This limit helps prevent people from abusing the program. However, this can affect people who desperately need to relieve their debt. Legal guidance can help people explore their bankruptcy options.