There are times when someone may start a bankruptcy case and then come into money or find that they are able to repay what they owe. Perhaps they get a new job, or maybe they’re able to work out a resolution with a credit card company or lender that they didn’t realize would work prior to the bankruptcy.
Whatever the reason is, you may be asking if you are allowed to back out of a Chapter 7 bankruptcy once you begin. Unfortunately, the answer is usually no. However, in some circumstances, you may be able to get the case dismissed, so it’s a good idea to learn more about your specific legal rights before filing.
Even if you can’t back out of Chapter 7 bankruptcy, you can change the form of bankruptcy you choose
Sometimes, it may be better for you to switch the type of bankruptcy you’re going into rather than to cancel a bankruptcy completely. You can switch to filing for Chapter 13 bankruptcy, or you may opt for a Chapter 11 or 12 bankruptcy in some cases.
What should you do if you want to cancel your bankruptcy?
If you do want to cancel your bankruptcy, one of the best things you can do is to talk to your attorney about the legal process you need to complete to do so. You may need to demonstrate that canceling the bankruptcy won’t hurt your creditors.
Keep in mind that your bankruptcy may stay on your record even if you ask the court to dismiss it. For that reason, many people complete a bankruptcy once it has begun even if they find that they are in different circumstances.
If you do intend to dismiss the bankruptcy, then you will need to file to dismiss it. You may need to go to court to explain to the judge why you’d like to have the case dismissed. If it is in your creditors’ best interests for you to cancel the bankruptcy, then the court may allow it. If the dismissal could end up hurting your creditors, then the court may not allow the dismissal to move forward.