You may have filed bankruptcy before and told yourself, “I will NEVER do that again.” But then life happens and you lose a job or have a medical emergency, and you find yourself overwhelmed with debt and are considering filing bankruptcy again. Or, perhaps you attempted to file bankruptcy yourself or hired the cheapest, most inexperienced lawyer you could find, and your case was dismissed for the failure to file the correct paperwork. Then, you made need to file again with the help of an experienced bankruptcy lawyer to get it right. In our law practice, we see both of these situations this all the time. And we can help.
There are really two issues involved when a person has multiple bankruptcy filings. First, will the client get a discharge of his debts in his second case? Second, will the client get the protection of the automatic stay (a “protective bubble” that stops collection activity, lawsuits and foreclosures) in his second case?
As to whether your debts will be discharged, there are a number of rules, which seem straightforward, but often require a detailed evaluation from your attorney:
• You can file successive Chapter 7 cases every eight years and receive a discharge;
• You can file a Chapter 7 four years after receiving a Chapter 13 discharge;
• You can file a Chapter 13 two years after filing an initial Chapter 13 case.
• You can file a Chapter 13 and then a Chapter 7 after six years and receive a discharge (in some very limited circumstances).
In addition, it may still make sense for you to file a bankruptcy case even if you will not get a discharge. For example, if all of your credit card debt was discharged in a prior Chapter 7, and you incurred no additional debt after the bankruptcy, it might make sense to file a Chapter 13 bankruptcy case to simply pay back mortgage arrears and save your home from foreclosure because you don’t actually need a discharge. Or, perhaps you should consider a so-called “Chapter 20” if you need to avoid any liens, and there is an appropriate justification for the successive filings and a change in circumstances between filings that is appropriate under the bankruptcy laws.
Regarding the “automatic stay,” if you filed one prior case within the last year, the automatic stay will only last for 30 days. For the automatic stay to continue longer than that, your attorney will have to file an appropriate motion and justify the extension of the stay under the bankruptcy laws. However, if you filed more than one prior case within the last year, there is no automatic stay. The only way the automatic stay can be imposed is if your attorney files the appropriate motion and is able to justify imposition of the stay under the bankruptcy laws. If you do not have the protection of the automatic stay when you file for bankruptcy, and creditors may still be able to proceed with their collection activities.
If you are considering filing for bankruptcy, you will need an experienced attorney to evaluate your case. The firm of Laura Margulies & Associates, LLC has successfully handled thousands of cases in Maryland and Washington, D.C., many involving unique or novel issues. Please contact us today for a consultation at (301) 816-1600. Our website address is: www.law-margulies.com.