If you have already been through bankruptcy in Georgia, you are aware of how the process works and how your debts are treated under the US Bankruptcy Code. Whether you filed for Chapter 7 discharge or Chapter 13 debt reorganization, you were likely able to eliminate all or most of your dischargeable debts. Unfortunately, the circumstances of life can often interfere with your efforts to get a fresh start and move forward on solid financial footing. Your debt might become overwhelming once again, so you want to know your options for getting back on track.

Because of your experience with Chapter 7 or Chapter 13 the first time around, you might be considering filing a second bankruptcy case to resolve your debt. Indeed, the process does not change significantly when you file another case, but there are factors to note for subsequent bankruptcies.

There are some questions and complications when moving forward with Chapter 7 or Chapter 13 again, so it is wise to retain legal representation. An Athens, GA bankruptcy attorney will guide you through the proceedings, and it is useful to review some information on what to consider with filing a second bankruptcy in Georgia.

Chapter 7 Basics

The type of bankruptcy that most people are familiar with is Chapter 7, in which your debts are discharged through the process. You must meet one of two important criteria to qualify:

1. Your earnings must fall below the state median income level, considering the size of your household.
2. If your income is above the state median, you can qualify through the Means Test. Your earnings are measured along with other expenses.

You might need to consider Chapter 13 bankruptcy if you do not meet one of these two requirements. If you are eligible, Chapter 7 will wipe out qualifying debts. There is one critical caveat to keep in mind, however. The bankruptcy trustee will take control over your assets and has the power to sell as necessary to pay back creditors. It is possible to use bankruptcy exemptions for Chapter 7, allowing you to protect assets from liquidation.

Overview of Chapter 13 Bankruptcy

Another type of bankruptcy that is available to individuals and married couples is Chapter 13 debt reorganization. As the term suggests, your debt is restructured during the process and reduced into a single monthly payment. The debt repayment plan is designed to be an amount you can afford based on your income. For this reason, the main criteria to qualify for Chapter 13 is that you have a job to pay creditors under the plan.

With Chapter 13, your assets will not be liquidated to satisfy debt to creditors. Instead, you are paying them back through the debt repayment plan. The amount that you pay through the plan will be less than the total that you owe, because of the reorganization of your debts. The outcome of Chapter 13 is similar to Chapter 7 in that you discharge qualifying debt once the case is over. This type of bankruptcy does take longer because of the debt repayment plan, which will be in effect for 3 to 5 years.

Time Restrictions on Bankruptcy

When filing a second bankruptcy case, the US Bankruptcy Code provides rules on how long you must wait before moving forward with Chapter 7 or Chapter 13. The laws seek to avoid a situation where an individual files for bankruptcy repeatedly, incurring debts in between cases. Always remember that creditors suffer a financial loss with bankruptcy and wiping out your debt, so the time restrictions protect their interests.

The specific rules for filing a second bankruptcy in Georgia are:

• Chapter 7: When you will be filing a subsequent Chapter 7 case, you must wait at least 8 years after a previous Chapter 7 bankruptcy. If you opt for Chapter 13, you must allow at least 4 years after your Chapter 7 proceedings.
• Chapter 13: If you previously went through Chapter 7 bankruptcy, you cannot file for Chapter 13 until 4 years have passed. To file a second Chapter 13 case after a prior proceeding of the same type, you need to allow 2 years.

Note that the date of filing a previous case is the date for measuring these time restrictions, as opposed to the date that your debts were discharged.

Considering Chapter 7 v. Chapter 13

Timing is just one factor to review when you are thinking about going through bankruptcy again, and the rules are strict. Other issues are not necessarily based upon bankruptcy rules, but there are decisions you must make about Chapter 7 versus Chapter 13. You should consider a few points that will help you decide which type is right for you the second time around:

• Chapter 7 rules may disqualify you if your income is too high, in which case Chapter 13 is your only option.
• Despite being eligible for Chapter 7, you might consider Chapter 13 for another important reason. There is no liquidation of assets in Chapter 13. If you have significant assets to protect, Chapter 13 might be a good fit.
• Another timing issue might affect your decision if you qualify for both types of bankruptcy. A Chapter 7 case takes around 4 to 6 months, but a Chapter 13 is 3 to 5 years for the debt repayment plan.

Timeline of the Bankruptcy Process

You might recall the basics after completing a Chapter 7 or Chapter 13 bankruptcy case in the past but some reminders are important. Once again, you will need to complete a credit counselling course within 180 days before filing. There is also a great deal of preparation beforehand, so you must collect and organize your financial documents. Make sure to include all paperwork regarding assets and expenses, as well as income and debts.

Once you have waited the requisite amount of time measured from your prior bankruptcy, you can get started with Chapter 7 or Chapter 13. Essential tasks include:

• Completing the bankruptcy petition;
• Preparing schedules and attachments for Chapter 7 or Chapter;
• Filing your petition with the US Bankruptcy Court for the Middle District of Georgia, for cases filed in Athens, GA;
• Drafting your debt repayment plan for Chapter 13, which must be filed with the court early in the process;
• Going to the meeting of creditors, where creditors will ask questions about your petition and request information about your financial status; and,
• Obtaining the final discharge order from the bankruptcy court that removes qualifying debt.

Myths About Second Bankruptcy Cases

One of the key misconceptions about bankruptcy is that you would be penalized in some way or have to pay a fine if you want to file a subsequent case. The rules do not aim to punish you if you qualify for Chapter 7 or Chapter 13 after waiting for the designated time. Additional myths about bankruptcy in general need to be debunked.

• Though you might have heard otherwise, creditors cannot seek payment from you during bankruptcy. Once you file, the automatic stay applies to Chapter 7 and Chapter 13 cases. Creditors are prohibited from all collection efforts.
• Bankruptcy indeed affects your credit score, but it is a myth that your financial future is destroyed. If you are already struggling, chances are that your credit rating has suffered. Chapter 7 and Chapter 13 may not have a significant negative impact.
• Another item of misinformation is that you can discharge all debts in bankruptcy. With both types of cases, there are limits. You cannot eliminate alimony, child support, and certain fines you owe to the government.

Do’s and Don’ts Before Filing Bankruptcy

Planning is an important part of the strategy when considering filing Chapter 7 or Chapter 13 after a previous bankruptcy case. There are a few tips to ensure a smooth process:

• Do avoid incurring new debts in the months before you file.
• Do not make any purchases of luxury items.
• Never transfer assets to someone for less than fair market value or under other circumstances that might indicate fraud.
• Do retain a lawyer for assistance with your bankruptcy case to maximize the benefits of Chapter 7 and Chapter 13.

How a Georgia Bankruptcy Attorney Serves Your Needs

Regardless of whether you had legal counsel the first time you filed, you should retain an experienced Athens, GA bankruptcy lawyer for a second bankruptcy. The timing is crucial, and you risk having your case dismissed if you do not meet the appropriate criteria for a waiting period. Under such circumstances, the automatic stay is terminated. Creditors can start or continue legal proceedings against you.

Another essential way an attorney supports you in bankruptcy is decision-making with Chapter 7 versus Chapter 13. When you have a choice between the two, you will need guidance on how to move forward. Plus, a lawyer will help advise you on exemptions in Chapter 7, enabling you to keep qualifying assets. If you opt for Chapter 13, you can trust your attorney to help develop the debt repayment plan.

Consult with an Athens, GA Bankruptcy Lawyer Right Away

Even if you do need to wait to file a second bankruptcy in Georgia, time is of the essence to get started with planning and developing a strategy. At Morgan & Morgan, Attorneys at Law, P.C., our bankruptcy lawyers will advise you on your options and timing for Chapter 7 and Chapter 13. We can also assist with all paperwork and enforcement of your rights in court. To learn more, please contact us to set up a free consultation. A Georgia bankruptcy lawyer will meet with you at our offices in Athens, GA.

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