After you file a bankruptcy case, you really hope that you can put that permanently into your rearview mirror. But sometimes life isn’t so fortunate. And the law recognizes that. If you need to, you can get relief from your creditors again.
Did You Join in the Bankruptcy Filing Frenzy of 2005?
More people filed bankruptcy in 2005 than ever before or after. More than two million bankruptcies were filed that year. That was in spite of the U.S. economy doing relatively well–a whole heck of a lot better than during the Great Recession which started a couple years after.
Indeed this spike in bankruptcy filings had less to do with the state of the economy than with the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (“BAPCPA”), a major overhaul of bankruptcy law that went into effect on October 17, 2005. People got word about this because it had been in the works for many years. Also, when Congress passed and President George W. Bush signed it into law in the spring of 2005, its effective date was 6 months later, giving people the chance to file under the prior more debtor-friendly bankruptcy laws. So, just anybody who was interested in filing made a point of doing so.
To give you a sense of how much this law was driving the filing numbers: more people filed bankruptcy during the first 16 days of October 2005 before the law changes than filed in the entire year of 2006!
The Timing Rules
If you are one of the more than two million people who filed bankruptcy during 2005, and are having financial problems again, you can likely file another bankruptcy case now or in the next few months if you need to.
The timing rules depend on what Chapter of bankruptcy you filed under in the past (Chapter 7, 11, 12 or 13), and what Chapter you will be filing under now.
To file a Chapter 7 case now:
1) if you had filed a Chapter 7 or Chapter 11 case AND got a discharge of your debts in that case, you are required to wait 8 years from the filing date of your prior case to the filing date of your new Chapter 7 case;
2) if you had filed a Chapter 13 case AND got a discharge of your debts in that case, you are required to wait 6 years from the filing date of your prior case to the filing date of your new Chapter 7 case; BUT with the twist that you don’t have to wait at all if in that prior Chapter 13 case you had paid 100% of your debts, or had paid at least 70% and met some other conditions.
To file a Chapter 13 case now:
1) if you had filed a Chapter 7 or Chapter 11 or Chapter 12 case AND got a discharge of your debts in that case, you are required to wait 4 years from the filing date of your prior case to the filing date of your new Chapter 13 case;
1) if you had filed a Chapter 13 case AND got a discharge of your debts in that case, you are required to wait 2 years from the filing date of your prior case to the filing date of the new Chapter 13 case.
(Be aware that Chapter 11 is usually for a business but can be for consumers if they have a very large amount of debt; Chapter 12 is a payment plan for farmers and fishermen.)
Notice that the date that counts for all these time periods is the case filing date, NOT the date the discharge of debts was entered by the court in the prior case. It’s the filing date of the old case that starts the time period, and the filing date of the new case that needs to be beyond the applicable time period.
So, If You Filed Bankruptcy in 2005. . .
2005 was 8 years ago. If you filed a Chapter 7 case in 2005 and successfully got a discharge of your debts in that case, you can file a new Chapter 7 case this year starting on the day after the date you filed your case in 2005.
Under any other combination—prior Chapter 7 to new Chapter 13, prior Chapter 13 to new Chapter 7, or anything else—the 2, 4, or 6 year rules apply. So if your prior case was in 2005, you are now well past the time when you can file a new bankruptcy case.