My injury case was dismissed in California. Can I file for bankruptcy again?

accident-994009_640Below is very general information which should not be used as actual legal advice. If you have banruptcy questions seek the advice of an actual California bankruptcy lawyer. Here is one who serves up free advice: Lancaster CA bankruptcy lawyer Elena Steers.
Can I file for bankruptcy again after my injury case was dismissed in California? 
You can’t use a personal injury case as a bank. There’s risk involved in any case, and if your case is dismissed for any number of reasons, you have no money in the bank. It has happened to people before. They file for Chapter 7 bankruptcy, and they get discharged with a clean slate and a new start. Then they’re in an accident, and they file a lawsuit against the party that they purport to be liable, but the lawsuit gets dismissed. They were counting on using the net proceeds from their personal injury case to pull them out the financial hole again, but it’s not going to happen. What’s the chance of filing another bankruptcy case?

Chapter 7 bankruptcy
You probably already know that filing a Chapter 7 bankruptcy petition operates to protect debtors from creditors. A Chapter 7 discharge allows most debtors to wipe out all of their outstanding debt. They’re able to start from scratch again.

Chapter 13 bankruptcy
A debtor can start all over again with a Chapter 13 bankruptcy too, but he or she is required to pay off certain debts. Unsecured debts are placed in one category, and based on the debtor’s disposable income, a payment plan is approved by the court. As opposed to a Chapter 7 bankruptcy when a debtor is usually discharged within 180 days, the Chapter 13 bankruptcy goes on for three to five years.

The time limitations between filings
Given your circumstances, the law doesn’t allow you to file another Chapter 7 bankruptcy petition until eight years after the date of your initial discharge. It’s also unlikely that you’d be able to seek protection through a Chapter 13 petition. You’re required to wait four years from the date of filing of the Chapter 7 proceeding to be discharged in a Chapter 13 bankruptcy. If you had previously been discharged in a Chapter 13 bankruptcy, you can actually file a new Chapter 13 proceeding anytime after being discharged in the first Chapter 13 case, but you’re required to wait two for years to be discharged. Under those circumstances though, your automatic stay and protection from creditors could be highly limited.

Any accident case comes with certain risks. That’s part of the ratioale behind contingency fees when attorneys undertake the representation of clients personal injury cases. Don’t plan on using a personal injury case as a bank. Banks go bankrupt too.


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