Learning About Bankruptcy Proceedings

Changed Your Mind About Filing Bankruptcy? Here Is What You Need To Know

by Seth Beck

Whether you made the decision to file for bankruptcy hastily or you simply do not like the idea that you could lose some of your property, you might not be able to dismiss your case. There are special circumstances that govern if you can. 

Who Can Dismiss Your Case?

When you file, there is no guarantee that your case will follow completely through the bankruptcy process. At any time, the court can dismiss your case. Your bankruptcy trustee can even ask the court to dismiss it. For instance, if the trustee feels that you have not been honest about your assets and debts, he or she can ask the court to dismiss your case. 

What If You Want to Dismiss It?

In the event that you want to dismiss the case yourself, you could run into stumbling blocks. Your bankruptcy attorney would have to file a motion asking for a hearing to consider your request to dismiss the case. You must present the court with a good reason as to why you want to dismiss it. For instance, if you are now able to take care of your debts and worked out agreements with all of your creditors, the court might consider your request. 

However, if you only want to dismiss the case because you want to avoid losing your assets, the court might not agree to your request. The judge will review your debts and determine if dismissing your case hurts your creditors. If the judge feels that a dismissal would be harmful to your creditors, it is likely your request will not be honored. Creditors are harmed when their chances of recovering losses are taken away. If your bankruptcy is completed, the creditors can possibly recover some of their damages. By dismissing it, the chances that the creditors recover losses is smaller. 

Will the Bankruptcy Filing Impact Your Future?

Even if the court does agree to your request and dismisses the case, your filing could still possibly impact your credit future. When you filed for bankruptcy, it was added to your credit history. When you apply for new credit, potential creditors can see that you filed before, which could make them reluctant to open an account for you. 

If you end up needing to file for bankruptcy again in the future, this can be even more damaging. Not only do you have the dismissed filing on your record, but you have the new filing. 

Before making any moves to dismiss your bankruptcy filing, you need to talk to your attorney. He or she can help you decide whether or not it is the right thing for you to do and help you explore other ways of handling your financial issues.