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What Happens When A Bankruptcy Is Dismissed?

26 March 2016

Deann Miles

In most instances, filing for bankruptcy ends with either a discharge of your debts or a repayment plan that allows you to pay off your debts in a reasonable amount of time. However, in some cases, the bankruptcy can be dismissed by the judge. If your bankruptcy was dismissed, here is what you need to know. 

What Are the Types of Dismissal?

Bankruptcies are dismissed with or without prejudice. When dismissing your case, the judge will state which one he or she is using in your case. The type of dismissal you receive impacts how you should proceed. 

A dismissal without prejudice means that you have the right to re-file your bankruptcy without a waiting period. This type of dismissal usually occurs when you fail to meet deadlines, file the right documentation, or fail to complete other requirements. 

A dismissal with prejudice is a bit more complicated. In this instance, there are restrictions in place to if and when you can file for bankruptcy. You could even be banned from filing for bankruptcy forever. 

A dismissal with prejudice usually occurs in cases involving fraud. For instance, if you failed to inform the court of all of your assets and it is discovered, your case could be dismissed. Depending on the circumstances, you could even face criminal charges for fraud.

What Can You Do?

How you handle a dismissal depends on whether or not your case was dismissed with or without prejudice. If your case was dismissed without prejudice, simply re-file your case. Ensure that you follow all of the instructions and guidelines. 

However, if your case was dismissed with prejudice, you can decide to wait out the period outlined by the judge or you can file an appeal. If fraud charges are possible, filing an appeal could work in your favor. 

If you are able to prove the reason for the dismissal was not valid, it could help you avert criminal charges. If you decide to wait to re-file, you are not protected by the automatic stay that kept creditors from taking any actions against you after you initially filed for bankruptcy. As a result, actions, such as a foreclosure, can go through. When you do re-file, follow the rules to avoid complications. 

In the event that you are unsure whether re-filing is right for you or you are considering an appeal, work with an attorney like Donald T Tesch, PS to get help with navigating the bankruptcy system. 

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