Understanding A Bankruptcy Case Dismissal Without Prejudice
When filing for bankruptcy, whether it is Chapter 7 or Chapter 13, you need to comply with specific requirements to complete your case and get a discharge. Unable to do so will result to bankruptcy court dismissing your case with or without prejudice. A bankruptcy case dismissal without prejudice means the reason for non-compliance is lapse in procedures.
Therefore, it is critical that you work with a bankruptcy lawyer in Elizabeth at the onset that bankruptcy is an eventuality. Doing so will enable you to take the correct steps and comply with all the necessary documentation thus, lessening the risk of your bankruptcy being dismissed, whether with or without prejudice.
It can be terribly frustrating to have a bankruptcy dismissed without prejudice. But you may consider this a blessing because a dismissal without prejudice is much better than one with prejudice. This is because if the court dismisses your bankruptcy without prejudice, you can immediately file another bankruptcy case (as long as you are otherwise eligible). Just make sure that you correct the mistakes you committed in your original filing so that the second filing of your bankruptcy case will be more successful. You also need to file a motion to extend or impose the automatic stay in your new case in order to keep creditors from taking any action against you.
On the other hand, a bankruptcy dismissed with prejudice is much more frustrating and has serious consequences. If your case is dismissed with prejudice, you may be prohibited from filing another bankruptcy for a certain period of time or forever barred from discharging any of the debts existing at the time of your first filing. Following are the Grounds for bankruptcy dismissal with prejudice:
- Attempt to cover up or hide your assets
- Case filed in bad faith, or
- Abuse of the bankruptcy system
Fortunately, courts usually dismiss bankruptcy cases without prejudice unless there is an evident abuse of the bankruptcy process or willful disregard of court orders
Filing a bankruptcy case is complex and entails a lot of documentation. Hence, it is important to use an experienced bankruptcy lawyer in Elizabeth to help you file correctly. Otherwise, your bankruptcy case will be dismissed and/or delayed.
What are the Reasons Why Bankruptcy Cases Are Dismissed Without Prejudice?
Usually, the court dismisses a bankruptcy without prejudice because of procedural errors(but without any intention to abuse the bankruptcy system). Except in rare circumstances, the court will usually dismiss your case without prejudice if you:
- Fail to finish the required credit counseling sessions before filing your case
- Fail to meet all eligibility requirements for the type of bankruptcy you wish to file
- Fail to file a required form with the court
- Fail to provide all required documents to the bankruptcy trustee
- Fail to attend a required court hearing such as the meeting of creditors or the bankruptcy confirmation hearing
- Fail to settle the court fees
- Fail to make your Chapter 13 plan payments, or
- Fail to follow any of the procedures.
Will I still be protected from creditors if my bankruptcy case has been dismissed?
An automatic stay is granted when you file for bankruptcy. It prevents your creditors from collecting their loans or garnishing your money. However, bankruptcy laws impose certain limits on the automatic stay if you file multiple bankruptcy cases. When you file for a second bankruptcy within a period of time, then that automatic stay is limited to 30 days. After the 30 days, the creditors may begin to collect again unless you petition to the court to continue the automatic stay. The reason for this limited automatic stay is to discourage bad faith bankruptcy filings such as filing for bankruptcy simply to delay or hinder their creditors.
It is possible to get the court to put the stay in place. If you have a good reason for the new filing—or why the previous filings occurred—then you can file a motion with the court asking for the automatic stay. The court will grant your motion if you prove that you filed the case in good faith.
Contact an Elizabeth Bankruptcy Attorney
Working with an experienced bankruptcy attorney in Elizabeth helps to ensure that your bankruptcy case proceeds smoothly. Your Elizabeth bankruptcy lawyer will make sure all required documents are filed, that you are aware of your court schedules, and that you comply with all the requirements set by the bankruptcy court. Do not take the risk filing bankruptcy on your own. You may be putting your bankruptcy at great risk of being dismissed. Let our bankruptcy lawyers at Karina Lucid take the burden off you. Call us for a free initial case evaluation.