How Many Times Can You Claim Bankruptcy in Illinois?
Updated on 29 November 2023
People often think there is a limit on how many times you can claim bankruptcy in Illinois, but this is not the case. The truth is that you can file as many times as you need it, as long as you comply with the legal conditions placed on refiling, such as certain waiting periods.
While there is no limit on the number of times you can file in Illinois, there are rules about how often you can. The length of time you must wait depends on whether you filed Chapter 7 or 13.
How Many Times Can You File Bankruptcy To Stop Foreclosure in Illinois?
Foreclosure is a type of legal action that a lender can use to take back real estate when the mortgage is not paid on time. Under the terms of most Illinois home loans, the lender can take possession of the property.
Fortunately, filing for Chapter 13 bankruptcy can help homeowners avoid foreclosure and stay in their houses. As soon as you submit a petition, the court will issue an “automatic stay” that prohibits your creditors from pursuing collection actions against you. This stops foreclosure proceedings in their tracks.
While the automatic stay is only temporary, the relief provided by the proceedings is not. With Chapter 13, you can eliminate about 90% of your non-mortgage debt, making it possible to afford your home loan payments again.
What About Car Repossession?
On top of stopping foreclosure, the automatic stay will temporarily prevent your car from being repossessed as well. In some circumstances, you will even be able to recover a vehicle that has already been repossessed. No matter which type of bankruptcy you pursue in Illinois, you can almost always work out a plan that allows you to keep your vehicle once the automatic stay is lifted.
How Many Times Can You File for Chapter 7 and Chapter 13 Bankruptcy?
You can file for either kind of bankruptcy as many times as you needed, provided you follow the time limits. The waiting period between bankruptcies depends on the type you filed previously, as well as the chapter you’d like to file the second time around. The waiting periods between filings are as follows:
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Between 7 and another 7- 8 years
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Between 7 and 13- 4 years
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Between 13 and 7- 6 years or full repayment
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Between 13 and another 13- 2 years
It’s important to note that the clock starts ticking on the day the first case was filed, not the date it was discharged.
Understanding Illinois Bankruptcy Chapter 7 and Its Benefits
Filing for bankruptcy chapter 7 in Illinois can provide much-needed relief for individuals overwhelmed with debt. This type of bankruptcy, also known as liquidation bankruptcy, allows debtors to discharge most of their unsecured debts, such as credit card debt and medical bills. In many cases, filers can keep their essential assets, like their car or home, as long as they continue to make timely payments on those loans.
Eligibility for Filing for Bankruptcy Chapter 7 in Illinois
To be eligible for chapter 7 bankruptcy in Illinois, you must pass the means test. This test compares your income to the median income for a household of your size in the state. If your income is below the median, you qualify for chapter 7. If it's above the median, you might still qualify if you can demonstrate that you have limited disposable income to pay off your debts.
How to File for Chapter 7 Bankruptcy in Illinois
Before filing for bankruptcy chapter 7 in Illinois, it's essential to gather all necessary financial documents, such as income statements, a list of assets and debts, and a detailed account of monthly living expenses. You will also need to complete a credit counseling course from an approved provider. Once you have all the required documentation, you can file a petition with the bankruptcy court. It's highly recommended to consult with an experienced bankruptcy attorney< to ensure the process is handled correctly and to maximize the benefits of your bankruptcy filing.
Life After Chapter 7 Bankruptcy in Illinois
While chapter 7 bankruptcy can provide immediate relief from overwhelming debt, it's essential to understand that it will remain on your credit report for ten years. However, by making responsible financial decisions and rebuilding your credit over time, you can regain financial stability. It's crucial to create a budget, prioritize saving, and establish healthy credit habits to prevent future financial hardship.
Consulting with an Experienced Bankruptcy Attorney
If you're considering filing for bankruptcy chapter 7 in Illinois, it's vital to consult with an experienced bankruptcy attorney who can guide you through the process and help you make the best decisions for your financial future. A skilled attorney can evaluate your financial situation, determine if chapter 7 is the right option for you, and ensure all necessary steps are taken to secure a fresh financial start.
Final Thoughts
Whether you need to stop a foreclosure or a repossession or are simply unable to repay your debts, filing for bankruptcy could be the answer to your problems. If you are considering filing a second or third time, there’s no need to decide alone. Call or text DebtStoppers today.
