Court cracks down on repeat bankruptcy filings

For Florida residents who are struggling with debt, bankruptcy is an option. While it is a serious step with major consequences, for some people it is the only way of effectively managing overwhelming debt. Ideally, debtors will take advantage of the protections offered by bankruptcy to better organize their finances and move forward toward financial health.

Unfortunately, there are some debtors who are unable to manage their finances effectively, even after a Chapter 7 or Chapter 13 bankruptcy discharge. While federal law dictates that a certain number of years must pass between discharges, some individuals have long-term financial difficulties. These difficulties may lead them to file multiple bankruptcy cases and, in some situations, disregard the stipulations of their current filings.

In a recent case in Kansas, a woman who had filed six bankruptcy cases in 14 years recently moved to dismiss her current filing after it was discovered that she had spent a substantial financial settlement in violation of her most recent bankruptcy plan. While the court would not deny the dismissal, it did state that the consequence of the dismissal would be that the debtor would never be able to receive another bankruptcy discharge. This decision was stayed for 21 days to give the debtor some time to reconsider her request.

Individuals who are faced with overwhelming debt may benefit from speaking with a bankruptcy lawyer. The lawyer may be able to review their situation and make recommendations about obtaining a bankruptcy discharge. In situations where someone has filed for bankruptcy in the past, the lawyer may also be helpful in determining a course of action that can help the debtor receive a discharge while doing a better job of managing finances in the future.