Can I Convert My Chapter 13 to Chapter 7?

This is a general outline provided by ROBERT J. ADAMS & ASSOCIATES. Offices in Chicago and Waukegan, Illinois

The primary practice of ROBERT J. ADAMS & ASSOCIATES is Chapter 7 and Chapter 13 Bankruptcy.

There  are reasons why you filed Chapter 13 instead of Chapter 7. Generally,  it was to save something like a car or your home when behind on the  mortgage. Some file Chapter 13 because their household income was higher  than the Means Test allowed. And, then there a folk who filed Chapter  13 because they had filed a prior Chapter 7 within eight (8) eight  years. And, also sometimes you have fallen behind on your Chapter 13  payments and a new Chapter 13 is not practical.

WHY CONSIDERING CONVERTING CHAPTER 13 TO CHAPTER 7?

  •  Filed to save a car; now it is not worth it;
  •  Filed  Chapter 13 to save your house; now things are bad and you can’t  maintain the mortgage payment, Chapter 13 payment and have enough left  over to live;
  •  You incurred more debts;
  •  Filed  Chapter 13 because the household income was higher than allowed by the  Means Test. Now there has been a reduction of income or increased  expense (unemployment; increase in the number of people in the  household; retirement with decreased income.)

WHO CAN CONVERT THEIR CHAPTER 13 TO CHAPTER 7 AND GET A “FRESH START”?

Generally, most individuals can convert their case to Chapter 7 and get a “fresh start.”

LIMITATIONS AND EXEMPTION

First,  all the dates that govern are the date of filing of Chapter 13 and if  there was a prior Chapter 7 the date of filing the prior Chapter 7 case.

  •  If you filed a prior Chapter 7 within Eight (8) years of the date of your Chapter 13 case you cannot convert.
  •  If  you filed because you couldn’t pass the Means Test but income went  down; or, expenses increase dramatically; and/or the number of people in  the household increased. You can do a new Means Test and may now  qualify.

WHAT IF IT IS NOW MORE THAN

Eight  (8) years since the filing of the prior Chapter 7? The option to  consider is voluntarily dismissing Chapter 13 or wait until the trustee  moves to dismiss. If there has been a motion to modify the automatic  stay while in Chapter 13 (regardless of the outcome) if you voluntarily  dismiss you can’t refile any bankruptcy for at least 180 days (6  months.) But if the trustee files a motion to dismiss and the case is  dismissed-then you can file Chapter 7 immediately.

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