Most people do not know that you can only file a Chapter 7 bankruptcy case once every eight years. However, that does not mean that you cannot find relief under the United States Bankruptcy Code through the help of an Oak Forest bankruptcy attorney. You can file a Chapter 13 during the time period in which you are not eligible for Chapter 7. This is commonly done to hold off creditors and pay back less than the full amount owed until such time you can do a fresh start bankruptcy case again.
If you are paying for an auto during a bankruptcy Chapter 13, then it is highly possible that your unsecured creditors such as credit cards and medical bills will receive nothing back on the debt. This assumes that you can file another Chapter 7 prior to the creditors receiving a disbursement under Chapter 13. Your bankruptcy lawyer will be able to calculate the approximate amount that creditors are to received and the complex bankruptcy software can estimate how much of a percentage that creditors will receive.
Now why would someone need to file Chapter 7 bankruptcy again, before the eight years has passed? Well, people get back into trouble again. They may take advantage of credit card offers immediately after filing the first bankruptcy case and have made poor choices in regard to purchases. They may have had a medical issue in the first case and have not yet fully recovered. Also, they may have failed to find medical coverage and another illness or injury has led to high medical bills.
I have also seen cases where a person drives without auto insurance and gets involved in an auto accident. The bankruptcy filing takes care of the debts surrounding the accident. However, the person lets the insurance lapse prior to the second case. This lack of insurance can then lead to another bankruptcy filing.
Thus, Chapter 7 is only one of your bankruptcy options to handle a debt problem. It is obviously the best method if someone is seeking a fresh start, however, timing is everything. If you are not permitted to file another Chapter 7, then talk with your attorney about the relief available under Chapter 13. You just may find that you are still getting relief from garnishments, lawsuits, harassing phone calls and the like. Most attorneys will speak and meet with you for free to determine what your options are. If you do not feel comfortable with the advice that you are given, try another attorney. It could be that one attorney can help where another attorney could not help.