Top 7 Reasons Why The Court Might Dismiss Your Bankruptcy Case

Bankruptcy cases get dismissed for a variety of reasons ranging from intentional misconduct to simply failing to file the correct forms with the court. Below are some of the most common reasons the court might dismiss your bankruptcy case. If you’ve gone through a Chapter 7 bankruptcy, you’ll need to wait at least 4 years after a court discharges or dismisses your bankruptcy to qualify for a conventional loan. If so, it can feel like you’ll never be able to return to financial normalcy.

For a Chapter 13 bankruptcy, the waiting period is two years after discharge or four years after dismissal. An exception to the four-year waiting period for dismissed Chapter 13 cases is a two-year period in cases with extenuating circumstances. Fannie Mae considers divorce, large medical bills, and job loss to be “extenuating circumstances.” Freddie Mac has the same requirements as Fannie Mae. Freddie Mac defines “extenuating circumstances” as an event that was beyond the borrower’s control. The process starts when the debtor, trustee, or creditor files a motion requesting the dismissal.

Payments to certain secured creditors (i.e., the home mortgage lender), may be made over the original loan repayment schedule so long as any arrearage is made up during the plan. The debtor should consult an attorney to determine the proper treatment of secured claims in the plan. While you don’t need to wait for a bankruptcy to disappear from your credit report to get a mortgage, you must adhere to a waiting period before applying. How long you’ll have to wait depends on the type of bankruptcy you file, as well as the type of mortgage you plan to get. If extenuating circumstances are present — such as a divorce, job loss, illness, death of a primary earner or other unforeseeable events — you may qualify for a home loan sooner. Chapter 13 bankruptcies involve a reorganization of the consumer’s debts and a repayment plan extending from three to five years.

For instance, at the time of this writing, under the Oregon exemptions a debtor may keep an automobile as long as the debtor’s interest in the automobile does not exceed $3,000. A single debtor may exempt up to $40,000 of the debtor’s home. Two or more debtors who are members of the same household may exempt up to $50,000 of their home.

As with other government-backed loans, you can apply for a USDA mortgage after bankruptcy filing. You don’t even have to complete your payment plan, just make at least 12 timely payments. You’ll also need written permission from the bankruptcy court.

About Federal Courts

A dismissal happens when you decide to withdraw your filing, or because you did not make the plan payments as required, or provided false information to the court. Lenders treat dismissals more harshly than discharges in many cases. You are not technically getting a mortgage after bankruptcy, because a dismissal means that https://loveconnectionreviews.com/ there is no bankruptcy.And you lose your protection from creditors. When you apply for credit, potential lenders check your credit, creating a hard inquiry on your credit report. Hard inquiries can negatively affect your credit score, although the impact varies from person to person based on your unique credit history.

Can you get new business loans while still in Chapter 13?

Get pre-approved to see whether you qualify for these loans. A typical Chapter 13 bankruptcy period lasts between three and five years, depending on the amount of debt and the debtor’s annual income. Claims of extenuating circumstances require supporting documentation and a reasonable explanation for how the event caused the bankruptcy. Waiting periods for both Chapter 7 and Chapter 13 bankruptcies get reduced for buyers with extenuating circumstances – often by half. It discusses the different mortgages, how long after bankruptcy you can buy a home, and the fastest ways to improve your credit to expedite your approval.

Getting a Credit Card or Loan after Bankruptcy

In addition, the Bankruptcy Code will allow the debtor to keep certain “exempt” property; but a trustee will liquidate the debtor’s remaining assets. Accordingly, potential debtors should realize that the filing of a petition under chapter 7 may result in the loss of property. Potential creditors don’t always consider bankruptcy a bad thing. You’ll find that many car loan lenders and credit card companies will eagerly extend credit to a borrower who “discharged” or wiped out debt in bankruptcy. Creditors realize that you’re likely to have more disposable income now that you’ve shed hefty credit card payments and other debts discharged in your bankruptcy case. If there are extenuating circumstances, the waiting periods can be as low as one year after a Chapter 7 discharge and one year of on-time payments in a Chapter 13 plan.

The IDB has case data for criminal, civil, appellate, and bankruptcy cases that can help researchers refine their requests. Please note, if you are seeking a fee exemption from a single court and/or for non-research purposes, contact that court directly. Putting as much down as possible or having adequate cash reserves can offset a high interest rate and increase your approval chances. You may also choose to pay for mortgage points to lower your interest rate. As long as there is no court order stating she couldn’t file (which I couldn’t imagine) then she could file.

For example, debtors who are engaged in business, including corporations, partnerships, and sole proprietorships, may prefer to remain in business and avoid liquidation. Such debtors should consider filing a petition under chapter 11 of the Bankruptcy Code. Under chapter 11, the debtor may seek an adjustment of debts, either by reducing the debt or by extending the time for repayment, or may seek a more comprehensive reorganization.