Second Bankruptcy Filing: Success Rates and What the Data Shows

Filing bankruptcy a second time is more common than most people realize. According to federal court data, a significant percentage of all bankruptcy filers have had at least one prior case. But do second filings succeed at the same rate as first filings?

The Data on Repeat Filings

Analysis of Federal Judicial Center data reveals:

• Prior filer rate: Approximately 20-30% of Chapter 13 filers have had at least one prior bankruptcy case
• Chapter 7 success rate: Second Chapter 7 filings have discharge rates similar to first filings (approximately 95-97%), as long as the debtor is eligible under the timing rules
• Chapter 13 completion rate: Second Chapter 13 filings have lower completion rates than first filings -- roughly 25-30% vs 35-40% for first-time filers. This suggests that the underlying financial difficulties often persist.

Why Second Filings Fail

• Same problems, no changes: If the circumstances that led to the first dismissal or failure are not addressed, the second case faces the same obstacles
• Reduced stay protection: Under Section 362(c), repeat filers face a 30-day stay limit (or no stay at all), which gives creditors more leverage
• Court scrutiny: Judges may look more carefully at second filings, especially regarding good faith
• Plan feasibility: In Chapter 13, the trustee and court will scrutinize whether the debtor can actually make the plan payments, especially if a prior plan failed

How to Make a Second Filing Succeed

• Address the root cause: If you lost a job, have you found stable employment? If medical bills caused the first filing, do you have health insurance now?
• Get an attorney: If you filed pro se the first time, consider hiring an attorney. The success rate for represented debtors is significantly higher.
• Build a realistic budget: In Chapter 13, propose a plan you can actually afford. An aggressive plan that fails is worse than a modest plan that completes.
• File the stay extension immediately: If you are within one year of a prior dismissal, file the motion to extend the stay on day one.
• Complete all requirements on time: Credit counseling, document production, plan payments -- no delays.

Cross-References

• dischargebar.org -- Timing bars between filings
• serialfiler.org -- Repeat filer rules
• bankruptcyfreshstart.org -- Making the second filing count

This site provides general information about bankruptcy law and does not constitute legal advice. No attorney-client relationship is created by using this site. Consult a licensed attorney for advice about your specific situation.