Bankruptcy Chapter 7 & 13

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FAQ Topics
  Stopping Creditors
When, Where & What
  to File

Debts Discharged
Child Support &
  Spousal Maintenance

Spouses & Joint Debts
Listing Creditors
Preference in
  Paying Creditors

Court Meeting
Property Lost
Tax Effect
Secured Debts
Changes &
  Chapter 13 Plan

Missed Plan Payments
Dismissed Cases
Credit after Bankruptcy
      

Dismissed Cases

What can I do if my case was dismissed? What options do I have?

Options available to you include:

  1. Move to reinstate your case. It may be possible to have the court reinstate your case. In all likelihood, the court and the trustee will allow reinstatement only if you make up all of the payments which you have missed, and if you ask for the reinstatement no more than a few months after the case was dismissed.
  2. Re-file under Chapter 13. In most cases you can file a Chapter 13 even if a previous bankruptcy was just dismissed. The new plan could pay the claim secured by your vehicle and prevent its loss. You will, of course, have to qualify for Chapter 13 as you did before, and you may have to demonstrate that this subsequent filing was made in good faith.
  3. Re-file under Chapter 7. When your Chapter 13 was dismissed, you did not receive a discharge of any debt. If you file under Chapter 7, you probably will not be able to keep property secured by debt which was being paid by the Chapter 13, such as your car, but you can obtain a discharge of most kinds of debt.

You will have to wait 180 days after dismissal of your previous case to re-file if that case was dismissed under either of two circumstances: (1) the case was dismissed on the court's order because of your willful failure to obey orders of the court or to appear in court when required (your inability to make plan payments would not ordinarily be a willful failure to obey a court order); or (2) the case was dismissed at your request after the filing of a request for relief from the automatic stay. 109(g) [12-4-98]


I received today a notice of entry of order re: discharge of my bankruptcy (Ch13) for failure to make timely payments. I have missed two payments and I'm in my fourth year of paying.  All payments to the secured creditor and IRS have been made but payments were still being paid to unsecured creditors.

I don't think the notice that you received was a "discharge" or your bankruptcy.  A discharge is granted after you have completed your plan payments and is an order that you no longer owe the debt.  You probably received a "dismissal" of your bankruptcy.

Once the case is dismissed, you lose protection from the court allowing all of your creditors to come after you again.  In addition, the amount to be paid to some of your creditors may have been reduced by your plan, and the dismissal will allow them to collect the full original balance plus interest.  This means that secured creditors, such as the company financing a car, may be able to repossess it even if they have been paid the full amount they were going to get under the plan.  It may also mean that IRS could levy your wages for interest, penalties, and that portion of the taxes which would have been discharged had you completed the plan.  All in all, it could be a very bad situation.

The practice of the trustees and the courts regarding reinstating a case may differ from district to district, so I can only tell you the policy in Arizona where I practice (you should check with your attorney for the policy in your district).

If a case has been dismissed, the trustees and the courts here will usually allow the case to be reinstated if you make up all of the missed payments and file a motion to reinstate the case.  If you do not act promptly, the court may close the case which would require that you also request that your case be re-opened and pay the filing fee again before they will consider a motion to reinstate.

[11-99]



These questions and answers are not intended as legal advice or as a statement of the law.  They are intended to suggest areas which you should discuss with your attorney.

Although Bankruptcy law is Federal code applicable to all states, the way it is applied may depend upon state law and varying practices of the courts, trustees, and even attorneys. As a result, some of these answers are directly applicable only in cases filed by our office in Arizona.

This page was last revised: 09/18/04