To be eligible for a discharge, a Debtor must not have filed bankruptcy within a specific period of time prior to their newest bankruptcy. Filing a bankruptcy case too soon, within that period, will prevent the Debtor from receiving a discharge.
- A Debtor must wait the following time periods between bankruptcy cases to receive a discharge.
If they previously filed a Chapter 7 bankruptcy and received a discharge:
- They must wait eight years from the date the first bankruptcy case was filed to receive a discharge in a subsequent Chapter 7. 11 U.S.C. § 727(a)(8).
- They must wait four years from the date the prior bankruptcy case was filed to receive a discharge in a subsequent Chapter 13. 11 U.S.C. § 1328(f)(1).
If they previously filed a Chapter 13 bankruptcy and received a discharge:
- They must wait six years from the date the first bankruptcy case was filed to receive a discharge in a subsequent Chapter 7, unless the prior chapter 13 plan 1) paid 100% of allowed unsecured claims, or 2) paid 70% of allowed unsecured claims and the debtor put forward the plan in good faith and made best efforts. 11 U.S.C. § 727(a)(9).
- They must wait two years from the date the first abankruptcy case was filed to receive a discharge in a subsequent Chapter 13. 11 U.S.C. § 1328(f)(2).
In summary, to get a discharge in a subsequent bankruptcy, you must wait the following periods of time:
|Subsequent Chapter 7||Subsequent Chapter 13|
|Prior Chapter 7||8 years||4 years|
|Prior Chapter 13||6 years||2 years|
Occasionally, it makes sense to file a bankruptcy case even if you may not receive a discharge. Filing a Chapter 13 bankruptcy case to prevent a foreclosure and allow the Debtor to catch up on their mortgage arrears is one such situation. The Chapter 13 bankruptcy’s automatic stay halts a foreclosure the moment it is filed (in almost all circumstances). The proposed bankruptcy plan can force the mortgage company to accept payments on the arrearage over a period of up to five years.
A Chapter 13 bankruptcy can halt a garnishment, and allow you to pay your creditors on a more reasonable schedule depending on your income and expenses. Even without a discharge at the end of your case, halting a garnishment can be a huge benefit to a family.
A Chapter 13 bankruptcy can structure payments owed to tax agencies, even without a discharge.
Although a discharge is the general goal of most bankruptcy cases, there are situations where you may want to file one even if you are ineligible for a discharge.
If you’re not sure what date you filed your previous bankruptcy case or just need assurance that you are now eligible based on these timelines, call out office for a free consultation with our bankruptcy lawyer. We provide professional advice for free, and we do not charge anything for the first meeting unless you choose to file through our office. Give us a call or text at (208) 719-0232.