An honest debtor files for bankruptcy under chapter 7 of the bankruptcy code, crushing credit card and medical debts are discharged, and then disaster strikes.  The job is lost, health insurance benefits disappear, a serious medical issue arises, and suddenly, we find ourselves back where we were before filing for bankruptcy.  Unfortunately, this happens more often than we would like.  Can we file for the same type of bankruptcy again to wipe out the new debt?

The answer depends on when the most recent chapter 7 was filed and if a discharge order was granted by the court.  At least eight years must pass between the filing of the first chapter 7 petition, in which debts were discharged, and the filing of a subsequent chapter 7 petition.  If the last chapter 7 bankruptcy was filed less than eight years ago, you cannot eliminate your new debts by filing another chapter 7.  If non-bankruptcy options for dealing with your debt won’t provide the necessary relief, you are left with two options.  The first option is to wait to file the subsequent chapter 7 bankruptcy until the eight years pass after the first filing.  If waiting is not an option, you may be able to stop creditors by filing a bankruptcy petition under chapter 13 of the bankruptcy code.  Unlike chapter 7, which is relatively quick and easy, chapter 13 is a debt repayment plan that may last for three to five years.

Because of the limitations on discharging debt in multiple bankruptcies, it is important to carefully plan your bankruptcy filing. Be sure to discuss any foreseeable changes in your financial situation with your attorney and to carry adequate insurance before filing the petition. With proper planning, you can reduce the risk of needing to file another bankruptcy petition down the road.