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Bankruptcy dismissal-What to do after dismissed bankruptcy

Author: Jessica Bennet
Community Mentor
Ask Jessica
Posted on: 24th Dec, 2005 10:30am
If you are facing difficulty to make payments on your debts and want to get rid of them, you can file bankruptcy (BK) to have them discharged. However, in certain situations, your BK case can be dismissed even before your debts are discharged. Bankruptcy dismissal refers to the pre-mature closure of your case prior to getting a discharge. Read through the sections below to find out the reasons behind dismissal and what options you have after the dismissal.

When can BK be dismissed?

  • Chapter 7 can be dismissed under the following circumstances.

    Voluntary dismissal: If you do not intend to go ahead with your BK case, you can request the court to have it dismissed. The judge will dismiss your case, as long as he thinks it does not affect your creditor's ability to collect the debt from you.

    Inability to follow rules: If you fail to follow the BK rules, your case can be dismissed for the following reasons:
    1. You do not pay the fees and costs associated with BK.
    2. You cause unnecessary delay in your case.
    3. You do not file necessary paperwork and fail to provide the court with required information.

    Abuse of Chapter 7: If you abuse the Federal laws regarding chapter 7, it can result in a dismissed bankruptcy under the following circumstances:
    1. You filed your case in bad faith
    2. You have filed Chapter 7 even though you can pay off most of your debts through Chapter 13.
    3. You live a luxurious life even after filing BK.

  • Your Chapter 13 case can be dismissed under the following situations.
    1. You do not file a repayment plan within time.
    2. You fail to make timely payments.
    3. Your repayment plan is not confirmed or your request for additional time to file another plan is denied.

What happens after a bankruptcy dismissal?

Once you file BK, the automatic stay comes into effect. This stops your creditors from taking any action against you, like a foreclosure, garnishment, lawsuit, etc. After the case is dismissed, the automatic stay is revoked and your creditors are free to come after you for the outstanding debts.

Do you have any option after the dismissal?

You always have the option of re-filing bankruptcy after dismissal. However, if you re-file within 1 year of the previous dismissal, the automatic stay will be effective only for a period of 30 days. You will have to file a motion to extend the stay immediately after re-filing your case. The BK judge will assess your situation and will either accept or deny your request for the extension.

However, you cannot re-file your case after dismissal, if your previous Chapter 7 or Chapter 13 case was dismissed within the last 180 days for the following reasons:
  1. You had your previous bankruptcy dismissed after a creditor sought relief from automatic stay.
  2. You did not obey court order.
  3. Your previous filing was considered fraudulent.

How does a dismissal affect your credit?

A dismissal affects your credit in a negative way. It shows up on your credit report for 7-10 years, though its adverse impact diminishes with time.
Posted on: 24th Dec, 2005 10:30 am
I filed a BK which was dismissed. Any options left now?
My ch 13 requires a lump sum in the amount of $12,000.00 and it was ordered that I refinance my home. With the economy the way it is, no one wants to touch me except "HARD" money lenders that charge 14.99% interest and approx $13,000.00 in closing costs! So my bankruptcy which I have paid on for 4 1/2 yrs is in jeopardy of dismissal, what shall I do?
Posted on: 05th Jun, 2009 09:57 am
Hi Cheryle,

You're in a tough situation. The court has ordered you to refinance the property. I would suggest you to speak to your original lender and check out if he can refinance the loan for you.

If your original lender is also not ready to refinance the loan, contact the bankruptcy trustee and lawyer and inform them about your situation. There are chances that you would get other options.
Posted on: 05th Jun, 2009 10:55 pm
I am over the unsecured debt limit by $6,000 one of my creditors is willing to withdraw their $18,000 claim which will bring us back under the limit. Can my creditor do this before the confirmation hearing?
Posted on: 11th Jun, 2009 07:00 pm
Hi lesa,

As far as I know, the creditor can withdraw their claim before the confirmation hearing. I guess, the creditor wants to settle the dues with you. As soon as he withdraws the claim, negotiate with him and settle your debts.
Posted on: 12th Jun, 2009 12:04 am
I filed bk 13 made my first payment on my first appearance to court. Which was 6/4/2009 when is my next due date? They did not give me information on the due date
Posted on: 29th Jun, 2009 03:15 pm
Hi claudia,

You should contact your bankruptcy attorney or your bankruptcy trustee in order to know when your next due date is. They will be the best person to let you know.

Posted on: 29th Jun, 2009 08:57 pm
my bankruptcy was dismissed 7 days ago, will I be able to get reinstated or will I loose everything?

Posted on: 30th Jun, 2009 03:47 pm
Your query has been answered in the given link:

Please take a look. I hope it'll help you.
Posted on: 30th Jun, 2009 10:21 pm
Ok, we wee buying a house from a guy and he defaulted on his loan. The house was supposed to foreclose on 7/7/2009, but did not because he filed for bankruptcy on 7/6. So, now on 7/13 the US Trustee made a motion to dismiss do to fact he was a corporation and had no licensed council. What I want to know is, can the foreclosure resume immediately once the judge grants the dismissal. If so, will it back date to when he filed the bankruptcy, and foreclose immediately. I am hoping for an immediate foreclosure because the lender he defaulted to is going to work out something with me.

Thanks for any help!!
Posted on: 15th Jul, 2009 05:21 am
Hi Lyle!

Welcome to forums!

The lender will have the right to start foreclosure procedure immediately after the bankruptcy case is dismissed by the court. Once the lender forecloses the property, you can apply to the lender and buy the property.

Feel free to ask if you've further queries.

Posted on: 15th Jul, 2009 09:57 pm
my chap 7 bankruptcy case was dissmissed because i did not complete the credit counseling course. can I take the course and re-file? (i paid the credit counseling course fee) must i pay another court filing fee? the case never went to a hearing . can i appeal the judges decision?
Posted on: 18th Jul, 2009 02:12 pm
Hi larry

As far as I know, you can file chapter 13 once your bankruptcy is dismissed but you can only file chapter 7 every 7 years.

Posted on: 24th Jul, 2009 01:37 am
I had to file to stop a sale because we couldn't get an agreement. The plans payments are way too high. When it is dismissed , can i get a modification negotiated, and if not can i get a short sale through a real estae co.?
Posted on: 02nd Aug, 2009 02:33 pm
hi al,

when you dismiss your chapter 13 bankruptcy, you can definitely negotiate for a loan modification. if the lender accepts your request, you would be able to save the property from being foreclosed upon. however, if the lender is not ready for a loan modification, then you need to apply for a short sale. to know how short sale affects credit score, check out the following link:
Posted on: 02nd Aug, 2009 08:26 pm
My ex-husband filed for chapter 13 bankruptcy about a year ago. I am joint on one of the accounts still, even though it was awarded to him in the divorce. i received a letter saying that the bankruptcy was dismissed. will the creditor come after me now?
Posted on: 22nd Aug, 2009 01:39 pm
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