After being dismissed, can I file Chapter 13 bankruptcy again?
Generally, one can file bankruptcy again after a chapter 13 case has been dismissed. Re-filing is relatively common.
Usually, there is no legal impediment to the re-filing itself. Exceptions are (1) when the case was voluntarily dismissed following a creditor's motion for relief from stay (e.g. to repossess or foreclose), (2) the dismissal was due to willful failure to follow court orders or otherwise proceed with the case, or (3) was dismissed with an explicit ban on re-filing. For (1) and (2), the debtor must wait 180 days prior to re-filing. For (3), the terms of the dismissal order must be reviewed and complied with.
Important legal limitations may exist regarding the automatic stay for repeat filers, under section 362(c)(3) and 362(c)(4) of the bankruptcy code. The automatic stay in bankruptcy stops collection activity, including calls, letters, lawsuits, repossessions, and foreclosures. It's an important benefit for many bankruptcy debtors. In the ordinary case, an automatic stay is automatic when filing a case.
If one prior dismissed case was pending within a year of the new bankruptcy filing, the automatic stay largely ends for the debtor after 30 days, unless the court grants an extension of the stay. However, the stay remains in effect against property of the estate, a fact that will sometimes provide the debtor with some protection in chapter 13. If two prior dismissed cases were pending within a year, no automatic stay goes into effect at all on the filing of the case. The debtor can petition the court to grant a stay, but this must be done in the first 30 days after filing.
In either situation, the debtor must show good faith in order to extend or impose a stay. If certain factors are present, demonstrating good faith is more difficult and requires a greater showing by the debtor:
- Multiple cases pending within the 1-year period prior to filing.
- Dismissal due to failure to file or amend the bankruptcy petition, schedules, or required documents without substantial excuse.
- Dismissal due to failure to provide court ordered adequate protection (this might be payment to a secured creditor or maintaining insurance on collateral, for example).
- Dismissal due to failure to perform on the terms of a confirmed plan.
- Lack of a substantial change in financial or personal affairs.
Good faith towards individual creditors must also be shown. If a creditor had moved for relief from the stay in a previously dismissed case, and the motion was either pending at dismissal or been granted, lack of good faith is presumed. Note that such a motion for relief combined with a voluntary dismissal of the prior case may have also triggered a 180 day waiting period to re-file.
Dismissal under 707(b) (including failing the statutory means test for chapter 7 eligibility) does not count when tallying the dismissed cases within one year.
When a previously dismissed debtor is considering re-filing, there are also practical considerations. The court will require a new filing fee, and generally a new attorney's fee will be necessary as well. Re-filing makes the most sense when something has changed since dismissal, since confirmation, or since previously filing. Obtaining confirmation of a new chapter 13 plan may be more difficult, as the standing trustee may be skeptical about the debtor's ability to perform and make payments.