It’s a very rare situation that a Chapter 7 bankruptcy will get dismissed. On the other hand, in a Chapter 13 bankruptcy case, getting dismissed (or “kicked out”) from bankruptcy, unfortunately, occurs more often than many people would think.
So Why Could A Case Get Dismissed?
- you are untruthful on the bankruptcy petition,
- you fail to file the required forms and schedules in the bankruptcy petition,
- you fail to pay the assessed fees, such as a filing fee, with the court,
- you fail to cooperate with the bankruptcy trustee (chapter 7 or chapter 13 trustee),
- you fail to timely make your chapter 13 plan payments,
- you are attempting to file a chapter 7 and you fail the “means test”,
- you’re in a chapter 11 bankruptcy and fail to make the Chapter 11 plan payments,
- you failed to take the required credit counseling course or financial management course, the chapter 7 trustee or the chapter 13 trustee asks the court to dismiss your case on legal grounds.
My Case Is Dismissed, Now What?
Since you likely know why the Chapter 13 case was dismissed, the most common question that occurs is, “What happens now?”
Your financial situation goes right back to where it was before you started the bankruptcy. Literally. When you file a bankruptcy, the second that you have a case number you have an automatic stay or protective bankruptcy “stay” against you. This means that any pending foreclosure, repossession, lawsuit, or debt collection attempts cease immediately. When you are dismissed from a bankruptcy, your status reverts right back to where it was at the time that you filed the bankruptcy. If your home was in foreclosure at the time that you filed the bankruptcy, the mortgage company has the right to start procedures right back up again. (And in most cases, they do.) If you were behind in your vehicle, your finance company has the right to resume where they left off and repossess the vehicle.
Not that it’s bad enough that your situation goes to what it was, don’t forget that you filed the bankruptcy in the first place; it will show on your credit, and stay there for the next 7 to 10 years. Whether you complete your case or not, you still filed a bankruptcy and your credit will reflect doing so. The good thing about being dismissed (and the only good thing) is that in most cases you can re-file the bankruptcy if needed. Of course, there are certain provisions and criteria to re-filing which you will need to discuss with your attorney. Usually, the court will allow you to refile another bankruptcy petition if there was a “harmless error” that caused your case to be dismissed. If you were in a Chapter 13 bankruptcy, there are some limitations as to how many times you can refile a Chapter 13. The bottom line in it all is to make sure that you take the steps necessary to comply with the bankruptcy provisions to ensure that your bankruptcy is smooth sailing.
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In 2009 files bankruptcy was dismissed. Filed again in 2011 and the case was managed poorly. The creditors did not get notified in timely manner and were not included in case. At the last few months the trustee is upset that I refused to pay additional money into case so he petition to dismiss the case. I refuse to expend anymore money or time in this case. What can I do at this point
Mary,
You can take a dismissal if you want but you will not receive a discharge of any of your debts. So you will be back in the same place as if you hadn’t filed the bankruptcy. However, you will still have the negative consequences (reduced credit score, etc.) of someone who has filed two bankruptcies. Good luck!
I and my wife are under current Chapter 13 three years this August, I have property that is paid for and has been offered up for sale, if sold the funds from the sale will satisfy the remaining balance in full as stated in the plan balence, if I proced with this will the creditors be able to assess late fees and interest dating back to the beginning of the case, or accept a pay off as stated in the case summery and close the account?
Thank you
Randy
Randy,
They should not be able to assess late fees and penalties as long as it is paid off within the Chapter 13 bankruptcy. If you take a dismissal and try to pay it all then they could tack on those fees. Bottom line is, contact your attorney and ensure that it is paid off within your bankruptcy and you should be fine. Good luck!
Could my wife file if I got kick out bankruptcy
Yes. As long as there is no court order stating she couldn’t file (which I couldn’t imagine) then she could file.
Original debtor passed away, we paid ch 13 until the very last payment. Now we need to file due to excessive escrow not owed, and some that were in original ch 13 if deceased. My question, can was dismissed on the last payment due date. Will all pad arrearage be considered lost or can adjustments be made in a new case b heirs.
If I understand your question correctly…if you file a new Chapter 13 bankruptcy then the mortgage company will file a proof of claim stating what is owed to them. That amount should be reduced if they were paid in the previous Chapter 13 bankruptcy.
I was 3 months from completing my chapter 13 I lost my job and ran out of money, my case was dismissed. None of the creditors came after me, but what happens to all the money I paid the trustee. My mortgage was the only debt involved and I paid that directly to the lender and also another 400 to the trustee, what happens to that money.?
You should be able to request a payout history from the Trustee. Once you pay the Trustee they will pay out your secured creditors and unsecured priorities after they have a portion of the money that goes towards their fees. After that, whatever is remaining will be paid out to unsecured, non-priority creditors. That’s an overly simplistic explanation but it gives you an idea of how the money is used.
I only recently discovered that a dismissed bankruptcy was such a negative thing. My wife and I filed for chapter 13 back in 2010 but the bankruptcy was dismissed. I believe it had something to do with our unsecured debt limit exceeding a certain amount, and not because of any misstep, deception or mistake on our part. Is this a legitimate reason for dismissal? And why should a dismissal for such an innocuous reason stain my credit so severely. We worked out payment arrangements and have been digging our way out of debt but our credit report still shows a dismissed bankruptcy.
Unfortunately, under section 109(e) of the Bankruptcy Code there are debt limits for a Chapter 13 bankruptcy. If you are above that limit and a creditor or Trustee objects then you are going to be dismissed from your case. The credit reports typically don’t look at the reason you were dismissed, instead, they just see a dismissal which will continue to hurt your credit. Depending on your situation you may be able to do a Chapter 7 bankruptcy or, potentially, a Chapter 11 bankruptcy. Good luck!
I filed bankruptcy to get my car back from a repossession. my case is being threatened for dismissal. My question is, if my case is dismissed, will my car get repossessed again? After we got the car back, we’ve been on time in every payment since then. And we paid off what we owed the car company.
If there is no longer a lien on the vehicle then there would be nobody to come and take it. Based on what you’ve said you should be fine.
i would like to know if my chapter 13 has been dismiss because I lost my job couldn’t make the payment on time were can I go from here this is my first time ever doing this I never file bankruptcy in my life but I had to so ive really don’t no what to da
If you don’t make the monthly payments your case will likely be dismissed. If you are able to get a new job you could always file a new Chapter 13 bankruptcy. Also, depending on how long you’ve been in your bankruptcy you could look at trying to get a hardship discharge. Just be sure to talk with your bankruptcy lawyer.
I filed 13 in 2009 I received my title to my car, now months late the finance company is saying I still owe a balance ,,,what am I to do?
Jackie,
It depends what state you are in. If you have the title and there is no lien reflected on the title then the finance company is an unsecured creditor because they don’t have a lien, possession or control over the collateral. The discharge from your Chapter 13 should have wiped out that debt. It’s tough to know for sure just because I don’t know where they are getting the balance from.
I filed chapter 13 on July 6th. I had just gotten a notice on July 3 that my house would be up for sharif sale that Monday. It was a holiday weekend. I had done the pre credit cousling online but no one was in the office to get certificate. I just got a notice my case was dismissed because I filed bankruptcy at 9:12am and my cc was at 1:34pm. What can I do?
First, you should hire a bankruptcy attorney to help you. In my years of experience I have never seen someone who filed a Chapter 13 bankruptcy pro se succeed. I’m sure there are some out there but it is extremely rare.
Second, you should go ahead and complete the credit counseling course and try filing the bankruptcy again…with an attorney. Good luck!
I was going through chapter 13 initially my payment was supposed to be $150 a month is now increased to 1331 they started including my car and it at 529 a month and they talked about Dismissing it because I could no long afford 1331 a month payments. Talked about paying 1500 for chapter 7 I just got off the phone with the car company because I would have to Resume the payments and noticed that my car payment if I was this the pay is $100 less than what my bankruptcy is charging me. Is this fraudulent
Alden,
I don’t totally understand your question. If you feel like you cannot afford the Chapter 13 bankruptcy then you could always try to convert to a Chapter 7 bankruptcy.
I am in a chapter 13 going on 3 years. I took out a loan from a new creditor. Now they are asking for my case to be dismissed. What can I expect or do. Can I refill a 13?
I would talk to your attorney if you have one. It really is going to depend on what loan you took out, what it was used for, how much it was for, etc. If you can show that you can make the payments on that new loan without requesting a reduction in your plan payments then it could be argued that creditors are not harmed and, therefore, your case should be able to continue forward. If it is dismissed as long as the judge doesn’t dismiss your case “with prejudice” then you could file again.
My boyfriend recently filed ch 13 and was making payments. Someone told his he had a 30 day grace period for his payments and he was kicked out do to “late payments” it’s only been about 5 months. What can he do ?
Hey can try to file a bankruptcy again. His attorney will likely have to file a motion to extend the automatic stay. There aren’t really any grace periods when filing a bankruptcy.
It my chapter 13 was dismiss and my car was the only thing I had was sured and my car loan was sold to a collection agency and the contract has expired with the company that I got the car from Can the collection agency pick up my car
Yes. They still likely have a lien agains the vehicle and hold the title to it. If so, they can come pick it up.
Hi I’m in Charlotte NC, and just received a letter for motion to dismiss my case. I have been in my chapter 13 for 2 yrs but had a baby, had car issues, tution due, rent went up by $250 and eventually just got behind. After 2 or 3 months of being behind I received a letter from the trustee stating my wages were going to be garnished, which so far they have garnished my wages for 2 months but I was already behind before my wage garnishment started. What should I expect at this point? I’m behind $5600 because my payments are $2800. And I don’t see any feasible way to get caught up by the April 26th court date.
I would contact your bankruptcy attorney and discuss it with them. Sometimes the Court will agree to not dismiss a case if the Trustee bumps up the payment enough to get caught back up within the life of the bankruptcy plan.
I live in Arizona and my chapter 13 is being dismissed because I fell behind on my child support. My arrears on my mortgage and vehicle are paid off, if I’m dismissed will they repo my car and foreclosure on my home? Thx
If you are current on the house and car it is highly unlikely they would repossess your property. They would much rather get your money than your property.
i have some dismissed bankruptcies can i still buy a home
There is nothing that immediately precludes you from buying a house. It will just come down to whether a finance company believes your credit is good enough now to provide financing for you. Good luck!
I filed a chapter 13 case which was dismissed with prejudice in Aug of 2016, I was told that I could still file a chapter 7, however, my question is if I file a 7 will I still have the benefit of the automatic stay?
It depends. Depending on how many previous times you filed a bankruptcy the automatic stay may not longer apply. However, typically, an automatic stay does being when a Chapter 7 bankruptcy is filed.