If you have decided to declare bankruptcy in Nevada, hopefully it will be the only time in your life you will never need to do so. When you file for either Chapter 7 or Chapter 13 bankruptcy, your goal is to regain control over your financial situation and get a chance to start over. Unfortunately, there are circumstances that can make multiple bankruptcies a necessity. Consider the following example:
You develop a serious medical condition that haunts you for years. You do not have any health insurance, and the bills for your treatment pile up. Your finances reach a breaking point after a few months, and you file for chapter 7 bankruptcy due to your mounting medical bills. Ultimately, most of your medical bills are discharged through bankruptcy but your illness continues to persist. Within a few years, you find yourself in another deep financial hole for new medical bills despite your previous bankruptcy discharge. In this circumstance, declaring bankruptcy a second time may be necessary.
It’s not hard to see why multiple bankruptcy filings make sense in some situations. But this begs the question: is there a limit on the number of times you can file for bankruptcy in Nevada?
HOW MANY TIMES CAN YOU FILE FOR BANKRUPTCY IN NEVADA?
It may surprise you to learn that there are no hard limits on the number of times you can declare bankruptcy. But that doesn’t mean the court won’t place limits on how frequently bankruptcy filers can obtain a discharge of their debt.
For starters, the U.S. Trustee and the bankruptcy court itself will closely scrutinize bankruptcy cases filed by someone who has previously filed before. Part of the Trustee’s job is to watch for fraud, and any debtor that seems to be using multiple bankruptcy filings to run up fraudulent debt or frustrate secured creditors may find their bankruptcy case dismissed.
YOUR DISCHARGE MAY BE DENIED
The real benefit of a bankruptcy filing isn’t the filing itself, but the discharge of your debts that comes at the end of the bankruptcy process. For that reason, there are some limits written into the bankruptcy court regarding discharges for frequent bankruptcy filers:
- If you file under Chapter 7, the court can deny your discharge if you previously received a discharge in a Chapter 7 case in the eight years before your current filing.
- If you file under Chapter 7, the court can deny your discharge if you previously received a discharge in a Chapter 13 in the prior six years. Exceptions are made in cases where you paid the majority of your creditors.
- If you file under Chapter 13, the court can deny your discharge if you received a discharge in a Chapter 7 case within the previous four years or a Chapter 13 discharge within the previous two years.
If you are considering filing bankruptcy for the second or subsequent time, an experienced Nevada bankruptcy attorney can help explain your options. For Nevada bankruptcy attorneys you can trust, contact Vohwinkel Law today for your free consultation.