Dismissal Without Prejudice (What Is It in Bankruptcy?)
The primary purpose for filing for bankruptcy is to discharge debts. However, failure to comply with bankruptcy regulations or meet all requirements can lead to a dismissal. If you are fortunate, the court will dismiss your case without prejudice. Fortunately, when the court dismisses your bankruptcy case without prejudice, you can refile at any time. The court allows a filer to refile after receiving a dismissal without prejudice because the mistakes that lead to such an outcome are usually procedural mistakes. A court does not dismiss a bankruptcy case without prejudice if the petitioner acts in an unethical manner. An example of a procedural error is failing to file the right forms.
If you are lucky, you can discharge all your debts after filing again. When you refile, make sure you correct the mistakes you made in the first place to get a positive outcome.
Courts dismiss bankruptcy cases without prejudice because of various procedural mistakes.
Some Common Reasons for Dismissals Without Prejudice
Courts dismiss bankruptcy cases when debtors fail to follow set regulations or meet specific requirements that allow them to discharge their debts successfully. A court would most likely dismiss your bankruptcy case without prejudice if you fail to;
- file the right forms
- attend the creditors’ meeting
- settle court fees
- attend a court hearing
- make timely payments in case of a Chapter 13 bankruptcy case
- meet deadlines or other requirements
Even though you can refile immediately after the court dismisses your case without prejudice, a dismissal without prejudice affects the automatic stay.
Impact of a Dismissal Without Prejudice on the Automatic Stay
After filing for bankruptcy in Iowa, one of the benefits you enjoy is the protection that comes with the automatic stay. In Iowa, the automatic stay protects bankruptcy filers from creditor harassment or any debt collection activity. Once the automatic stay takes effect, it lasts throughout the bankruptcy case unless the court dismisses your case. When a court dismisses your bankruptcy case without prejudice, you lose the protection of the automatic stay. Creditors can now come after you to seek payment for the debts you owe them.
Unfortunately, when you refile a bankruptcy case, the court places some limitations on the automatic stay. Some filers take advantage of the availability of this protection. They file for bankruptcy repeatedly to delay collection efforts from creditors. Because of such bad faith bankruptcy failing, courts choose to limit the automatic stay in refile situations.
If you refile within 12 months, the automatic stay will last for only 30 days. If you receive two dismissals in one year, and you choose to refile, you will not enjoy the protection of the automatic stay. However, in some circumstances, a filer can convince the court to award them the automatic stay protection. With the help of a qualified Iowa bankruptcy attorney, you can get the court to approve your request for automatic stay protection. You only need good reasons to support your rapid succession of filings.
Contact a Southeast Iowa Bankruptcy Lawyer Today
Ensuring you correct the mistakes that led to a dismissal without prejudice, you need the help of a qualified Iowa bankruptcy attorney. Reach out to a Southeast Iowa bankruptcy attorney today to receive professional assistance. Contact the Noyes Law Office, P.C., today to schedule a consultation.
Resource:
ianb.uscourts.gov/faq/what-automatic-stay
