In the wake of the housing bust, many people with excessive credit card debt filed Las Vegas bankruptcies. The situation for people in the city still isn’t very good, so it’s likely that many will run into credit problems again, and when they do they’ll reconsider bankruptcy as an option. This doesn’t happen often, unless it’s done strategically, i.e. filing a Chapter 13 bankruptcy to deal with mortgage debt after discharging unsecured debt in Chapter 7. When people do consider filing again, they ask whether there are limits to prevent people from abusing the bankruptcy system. They’re right on both points. Here is a quick rundown of the rules.
- If your first filing was in Chapter 7 (it usually is), you must wait eight years after your discharge before filing another Chapter 7 bankruptcy. If you wish to file in Chapter 13, you must wait four years.
- If your first filing was in Chapter 13, then you must wait six years after your discharge to file in Chapter 7 and only two years to file in Chapter 13.
That’s the quick rundown, and obviously discussing the situation with a bankruptcy attorney will reveal any exceptions your case may have fallen into.
There are situations where you can file without the goal of pursuing a discharge. Primarily this occurs in Chapter 13. People who are having loan payment problems will file again either for the benefit of using the automatic stay to halt a collection proceeding or foreclosure or to enter a Chapter 13 repayment plan to restructure your payments to your creditors for three to five years. After the period is over, they can choose to either pay down the debt, or they can file a third time when they’re able to discharge those debts. In some unusual situations, people will file repeated Chapter 13 cases to maintain a repayment plan.
Bear in mind, the time limits are to prevent people from obtaining multiple discharges in a short time period, not to keep people out of bankruptcy court entirely. It’s also critical to note that filing bankruptcy in itself will adversely affect your credit score and your access to credit later on. An experienced Las Vegas bankruptcy attorney will tell you about these consequences.
For more questions about bankruptcy in Las Vegas, please feel free to contact an experienced Haines & Krieger Las Vegas bankruptcy attorney for a free initial consultation. Call us at 702-880-5554 to set up your free consultation.