For most people, one bankruptcy case is enough: They are able to discharge all or most of their debts, get out from under their mounting pile of bills, and get back on their financial feet. However, some people may find themselves contemplating a second bankruptcy case. If you're one of them, you'll need to know the rules about how often you should file. You should also give serious thought to whether a second bankruptcy will really help you get out of debt.
Laws Limiting Multiple Bankruptcy Filings
You may file for bankruptcy more than once. However, under the 2005 changes to the Bankruptcy Code, you may have to wait a while between filings. If you already received a discharge of your debts in a Chapter 7 case, you can't file a second Chapter 7 case until eight years have passed since you filed the previous case. If you have already received a discharge of your debts in a Chapter 13 case, you may not file a Chapter 7 case until six years after you filed the Chapter 13 case. (This time limit doesn't apply if you received your previous Chapter 13 discharge in good faith, after paying at least 70% of your unsecured debts).
The time limits are shorter for filing a subsequent Chapter 13 case. You may not receive a second Chapter 13 discharge until at least two years have passed since you filed a previous Chapter 13 case or until four years have passed since you filed a previous Chapter 7 case.
Should You File Again?
As long as you have waited the required amount of time since your last bankruptcy case (and you meet the other eligibility requirements for bankruptcy, such as getting prefiling credit counseling), you may file a second bankruptcy case. But that doesn't mean you should.
First, consider whether the types of debt you still have will be discharged in bankruptcy. Some debts won't be discharged, including back taxes, child support you owe, and student loans (except in unusual cases). If most or all of your debt load is made up of debts that won't be discharged, a second bankruptcy filing won't do you any good.
Second, a bankruptcy filing will stay on your credit report for up to ten years. This could negatively affect your ability to get a job, an apartment, or a loan or credit card at decent rates. If bankruptcy could wipe out a large portion of your debt, this might be a price you're willing to pay. But you should still consider the potential consequences.