Why Was My Bankruptcy Dismissed & Can I Re-File?
Sadek and Cooper has over 60 years of combined experience in filing Chapter 13 matters in the Bankruptcy Courts for the Eastern District of Pennsylvania and the District of New Jersey. The Eastern District of Pennsylvania includes Philadelphia, Bucks, Delaware, Montgomery, Chester, Berks, Northampton, and Lehigh Counties. The District of New Jersey includes every county in the State of New Jersey.
Although our office has a confirmation rate for Chapter 13 matters well above 90%, there are approximately 300 bankruptcy cases per month dismissed in our geographical practice area.
Learn more about filing for a Chapter 13 bankruptcy.
Most Common Reasons For a Chapter 13 Bankruptcy Dismissal
There are several reasons why a Chapter 13 Bankruptcy is dismissed.
Most commonly, a Chapter 13 bankruptcy case is dismissed because the debtor fails to make regular monthly Chapter 13 bankruptcy trustee payments along with other monthly financial obligations.
Sometimes filers of Bankruptcy are unaware of their Chapter 13 payment obligation or unaware of a change in their payment and therefore the filer falls behind and is unable to catch up on payments.
There are also times that a change in financial circumstances, whether an increase in expenses or decrease in income prevents the bankruptcy filer from making regular and monthly trustee payments.
When there is a change in financial circumstances instead of facing dismissal, it is imperative to have regular communication with your counsel to discuss a suspension in payments or a modification of your Chapter 13 Repayment Plan to best ensure the affordability of plan payments and the success of the Chapter 13 Repayment Plan.
Another reason why Chapter 13 Bankruptcies are dismissed is the failure to file the Chapter 13 Repayment Plan and related Bankruptcy schedules in a timely manner. Failure to file all bankruptcy schedules is most prevalent in the type of filing known as an “Emergency Bankruptcy.” An Emergency Bankruptcy is filed to prevent repossession of a vehicle or to regain possession of a vehicle shortly after a repossession or in the case of stopping a pending mortgage foreclosure or soon upcoming sheriff’s sale.
An Emergency Bankruptcy is comprised of approximately only 10 pages of required bankruptcy forms along with a Certificate of Credit Counseling that is filed with the Bankruptcy Court. After the filing of an Emergency Bankruptcy Petition, a case number is assigned and the Automatic Stay (11 U.S.C. Section 362) imputed in all Chapters of Bankruptcy is enabled, thereby stopping any and all collection efforts, lawsuits, foreclosure, and replevin actions against the Bankruptcy filer or their property. Along with the benefits of an Emergency Bankruptcy, comes the burden of filing the remaining Bankruptcy Schedules within a timely manner as prescribed by the Court. Generally, the Bankruptcy Court only provides two to four weeks to file the remainder of the Bankruptcy Petition. In the event a Bankruptcy filer is unable to locate or provide their paystubs, bank statements, and/or tax returns in a timely manner, filing a timely full and complete petition is not possible and dismissal is foreseeable.
Learn more information about the filing of emergency bankruptcies.
Under 11 USC Section 341, there is a mandatory hearing which occurs about 30-45 days after the filing of a Chapter 13 matter. It is imperative that the Bankruptcy filer(s) and their bankruptcy lawyer appear at the hearing and all documentation has been properly submitted for the Section 341 meeting. Prior to the Pandemic, Section 341 Meetings were held in person in Philadelphia and Reading or in Camden, Trenton, or Newark, in Pennsylvania and New Jersey respectively. Bankruptcy filers would sit in a Courthouse or a hearing room for hours waiting for their cases to be called.
Nowadays, the 341 Meeting is held during a 15-minute time slot over the phone or Zoom. Accordingly, the 341 Meeting can be done on a remote basis, which is most convenient and comforting for the Bankruptcy filer(s). The 341 Meeting is also usually the only hearing that is attended by the Bankruptcy filer(s), although there are a series of hearings that follow known as Confirmation hearings which are attended by the bankruptcy lawyer involved in the bankruptcy case. Since the 341 Meeting occurs after the filing of the Bankruptcy matter, it is necessary that the Bankruptcy filer through their bankruptcy attorney provides the office of the Chapter 13 Bankruptcy Trustee paystubs and bank statements since the filing of the Chapter 13 filing. Although the burdens of a Chapter 13 matter are limited to appearing remotely and supplementing information, it is astonishing how many cases are unfortunately dismissed for failure to get through the 341 Meeting stage of a Bankruptcy case.
You Can Re-File For Bankruptcy
If your Chapter 13 matter is dismissed you do have the right to refile, however an additional Motion to Continue or Impose the Automatic Stay may be necessary based on the timing of the purported refiling. Sadek and Cooper prides itself on reviewing your situation in detail and reviewing whether re-filing Chapter 13 along with other options, listed below, may be available to you. During a free phone or Zoom consultation, we will review your prior bankruptcy filings to make sure it was complete and accurate, and also whether your Chapter 13 Plan is financially feasible or could be lowered on a monthly basis. Below is a list of options we recommend after the dismissal of a Chapter 13 matter:
- Refiling a Chapter 13 Bankruptcy Matter
- Reinstating your Chapter 13 Matter
- Filing a Chapter 7 Matter
- Mortgage Modification
- Short Sale
- Deed in Lieu of Foreclosure
- Debt Settlement
Sadek & Cooper Can Help
If your bankruptcy is dismissed and you are unsure how to proceed and would like to understand your options, please call the experienced bankruptcy attorneys at Sadek and Cooper at 215-545-0008 in Pennsylvania or 856-890-9003 in New Jersey. Our phones are answered 24/7 and we look forward to reviewing your financial situation in detail, discussing why your Chapter 13 Plan was dismissed, and devising a strategy that will bring help and bankruptcy relief.