Once a bankruptcy case is filed, whether Chapter 7 or Chapter 13, it cannot be completely reversed and will appear on a credit report for 7 to 10 years whether or not the case is actually completed. However, during the four- to six-month process of the actual case, it is possible to stop the bankruptcy proceedings and not actually finish declaring bankruptcy. Keep in mind that even if you do not finish the bankruptcy case, the fact that you filed will still be a matter of public record.
Visit the bankruptcy court in which you filed your case and inform the clerk of court that you want to file a motion to dismiss your bankruptcy. If you hired an attorney for your Chapter 7 or Chapter 13 filing, then he or she will do this on your behalf.
Fill out the form the clerk gives you, which is a request for a hearing in front of a bankruptcy court judge as to why you want to stop your bankruptcy case. You will be asked to briefly explain why you want to dismiss the bankruptcy proceeding. Normal acceptable reasons include a change of financial status (such as getting a new job or an inheritance) or marital status (such as a divorce or new marriage).
Attend your dismissal hearing, whether or not you have an attorney. The judge will ask you why you want to stop your bankruptcy and will also make sure you realize that once the bankruptcy case ends, you will lose certain protections under the law. If you fail to catch up your debts, you will once again be subject to legal action, such as lawsuits, wage garnishments, auto repossession and home foreclosure. If the judge approves of your reasons and also sees that you understand the possible consequences of a dismissed bankruptcy, he or she will dismiss your case. If your case is not dismissed, you may be able to appeal it and have another hearing if your reasons for stopping the bankruptcy are compelling enough.
- Remember that even an unsuccessfully completed bankruptcy will appear on your credit reports for 7 years for a Chapter 13 filing and 10 years for Chapter 7. This can still impact your ability to get new credit even if the judge does dismiss your bankruptcy case.