Even when a consumer has the best intentions when borrowing money, sometimes debts become unmanageable. When someone is overwhelmed by debt, unexpected medical emergencies, divorce, or any other financial obligation, they might consider filing for bankruptcy.
Can you file for bankruptcy in Oklahoma more than once? The simple answer is yes. While you may have used bankruptcy before to settle your financial strains, some rules dictate how often you can file.
The federal bankruptcy law has set up limits on how often you can file for both bankruptcy types – Chapter 7 and Chapter 13. And sometimes the automatic stay may be restricted to you. But, the Oklahoma bankruptcy lawyers at Mitchell & Hammond help their clients explore additional ways of getting financial relief.
What’s the Difference Between Chapter 7 and Chapter 13 Bankruptcy?
An individual or family going through financial trouble can use either Chapter 7 or Chapter 13 bankruptcy.
Chapter 7 bankruptcy is used if you want the court to forgive your debts completely. Most consumers who choose this type of bankruptcy don’t have many assets to protect and just want to start over again. You may lose most of your personal property, but it gives you a chance to a fresh start. The entire process can take anything between three to six months.
Chapter 13 bankruptcy restructures your debt payment plan and offers you partial debt ‘forgiveness.’ Most consumers who chose this type of bankruptcy have significant assets to protect. The new court-approved payment plan will be followed over three to five years. Once the process is over, the consumer should be able to keep all their property and have had paid off all unsecured debts.
Chapter 7 cases are more common than Chapter 13. However, this does not mean Chapter 13 is not a great option for individuals and families. The only way to know which option will serve you best is by speaking to a bankruptcy attorney in Oklahoma City, OK.
Are There Limits to How Many Times I Can File Bankruptcy in Oklahoma?
You can file as many times as you feel. However, a discharge on your new case will depend on how much time exists between each filing. How much time you should wait between each bankruptcy filing will depend on what type of bankruptcy you filed last time and whether it was successful or dismissed.
Your First Bankruptcy Ended in a Chapter 7 Discharge
If you received a Chapter 7 discharge (forgiveness), you must wait for at least eight years before you can file for another Chapter 7 bankruptcy. The waiting period is calculated from the day you filed the previous Chapter 7 petition. For instance, if you filed a Chapter 7 bankruptcy case on January 19, 2017, you qualify to file another Chapter 7 case as of January 19, 2025.
If you file before the eight years elapse, your discharge will be denied. This is because the court does not want people taking advantage of debt forgiveness whenever they don’t feel like paying back debts.
However, if you received a Chapter 7 discharge, you can file for a Chapter 13 bankruptcy after waiting for four years. This period is calculated from the date you filed for Chapter 7 bankruptcy. So if you filed your Chapter 7 bankruptcy case on January 19, 2017, and your debts were forgiven, then you can file for a new Chapter 13 bankruptcy case as of January 19, 2021.
Your First Bankruptcy Ended in a Chapter 13 Discharge
If you were offered a new repayment plan under Chapter 13 discharge, you have to wait two years before filing for another Chapter 13 bankruptcy case. This restriction is more lenient because you are showing a good faith effort to repay as much as you can.
If you want to file a new Chapter 7 bankruptcy case after receiving a Chapter 13 discharge, you must wait for six years before doing so. This time is also measured from the date you filed for the first Chapter 13 case. The only exception to this 6-year rule is if you paid 100% of your unsecured debt, or if you paid at least 70% of these unsecured debts and the court determines that you did your best.
The court’s intention isn’t to punish you for financial problems beyond your control but wants to reward you for doing your best in repaying your debts. Consult a Chapter 7 bankruptcy lawyer in Oklahoma just to make sure you are filing on a date that will permit a new discharge.
What if I Never Received a Discharge in My First Bankruptcy Petition?
If you filed under any of the two bankruptcy Chapters and your case was simply dismissed, you can always file a new petition immediately if you wish. If the court denied your discharge, your second petition might not be able to list debts in your first petition. You need an experienced Oklahoma bankruptcy lawyer to advise you on this.
Similarly, if your first case was dismissed with prejudice, like not obeying court orders, you will wait for at least 180 days before filing again.
Will Filing for the Second Time Help or Harm My Financial Situation?
Filing bankruptcy has its effect on your credit score, even though your debts will be forgiven. For instance, Chapter 7 stays on your credit report for ten years. And this can significantly affect your ability to qualify for loans or rent certain homes.
However, there are times when fling for the second time is the best option. Sometimes you don’t need forgiveness over your debts – you just need time to make payments.
Professional Who Understands Bankruptcy Issues, Time Limitations, and Legalities Behind Types of Debts
If you’ve previously filed for bankruptcy and feel you need to file again, consult a bankruptcy attorney in OK to advise you on the best course of action and help you understand your legal options. Most lawyers offer a free case evaluation on your first meeting with them.
As you prepare to speak to your bankruptcy attorney, it could help if you gathered information regarding your previous bankruptcy case like dates, and debts that were discharged. Moreover, think about what your financial goals are in this new case.
The decision to file for bankruptcy the second, third, or even fourth time is often a difficult one. Therefore, having an attorney beside you can significantly reduce stress and anxiety, allowing you to focus on what’s more critical; your business.