Bankruptcy is meant to be a tool to help individuals who have made critical financial mistakes make a fresh start. There are two main forms of bankruptcy: Chapter 7 (total discharge) and Chapter 13 (reorganization). Under both types of bankruptcy, an individual is able to file twice but there are limitations on how and when this can be done. Federal laws enacted after October of 2005 have made it more difficult to file bankruptcy multiple times.
Determine when your past bankruptcy was officially discharged by the courts. If a debtor files Chapter 7 bankruptcy, he or she may not be able to obtain another Chapter 7 bankruptcy for eight years after the discharge date. If a debtor filed Chapter 13 bankruptcy originally, the individual must wait six years prior to filing a Chapter 7 bankruptcy. Individuals who are struggling with debt may be able to file Chapter 13 bankruptcy in as little as four years after they have filed Chapter 7.
Work with a bankruptcy attorney to determine eligibility for filing bankruptcy a second time. A means test will be administered by your attorney to determine if your income is too low for the debt you have. A financial management course must be taken. Working with a credit counselor is also a requirement to be eligible to file bankruptcy for a second time. If these requirements are met, the individual is eligible for bankruptcy.
Realize that bankruptcy may not always be an option for some individuals. Individuals who fail to meet the above listed requirements or have too much income will not qualify. Income requirements are determined through the means test, on a state by state basis. For example, in Kansas, individuals may not make more than $39,488 (as of October of 2008). The applicable median family income is based on family size and state limitations.
Meet with the court appointed bankruptcy personnel who will review the case and determine if bankruptcy should be filed. This individual is required to monitor income and purchases to ensure individuals are not purchasing frivolously.
File a bankruptcy claim through an attorney or by filing a petition with the local bankruptcy court. Although an attorney is not required, laws now make the process more complicated and time sensitive. Individuals who file bankruptcy must meet specific deadlines. If deadlines are missed, the bankruptcy case may be thrown out of court.
Wait for official paperwork to be signed and approved by the court system. Once all requirements have been met for filing bankruptcy twice, the courts will assign a bankruptcy hearing for the paperwork to be signed.
Check the mail within four to six months of filing to receive a debt discharge statement. After this point, creditors may no longer claim the debt. For those filing Chapter 13, the same process is enacted, though a period of repayment is required which may last between two and three years.