• James D. Lynch

Shortened Automatic Stay for Repeat Bankruptcy Filings

If a debtor files bankruptcy, the automatic stay lasts as long as the bankruptcy case lasts. However, if the debtor's bankruptcy case is dismissed and the debtor files a second time within one year of the dismissal of the first case, the debtor's automatic stay lasts only 30 days. This is because there is a presumption that the debtor filed the second case in bad faith.


The debtor can file a motion to continue the automatic stay beyond the 30 days. In order for the court to grant this motion, the debtor must show, by clear and convincing evidence, that the second bankruptcy was filed in good faith.


If the second bankruptcy case is also dismissed and the debtor files a third bankruptcy within one year, there is no automatic stay upon the third filing. Again, the debtor would need to file a motion and prove the filing was in good faith in order to have an automatic stay for the third case.