Gurnee Bankruptcy Attorney On Converting From Chapter 13 To Chapter ...

In some circumstances, you can convert a case from Chapter 13 to Chapter 7 and vice versa states Gurnee bankruptcy attorney.  The typical scenario with a Chapter 13 conversion to Chapter 7 is where somebody no longer has the ability to repay under Chapter 13.  The reason why someone would file a Chapter 13 in the first place is to either protect property that has equity or to repay mortgage arrears or auto deficiency amounts over time.  

If during the course of the Chapter 13 bankruptcy case it comes to the attention that there is no equity in the property anymore or the debtor doesn’t have the ability to repay, then the case may be converted to one of Chapter 7.  The thing we have to look at as the attorney for the debtor is whether or not that client is eligible for a Chapter 7.  For example, if the individual has filed a Chapter 7 within eight years from the date the Chapter 13 was filed, then they cannot convert the case to a Chapter 7.  If it’s been over eight years, then we can simply dismiss the Chapter 13 and refile a Chapter 7. 

The timing is critical and it’s a little bit tricky so you want to consult with your attorney on whether or not you qualify to convert from Chapter 13 to Chapter 7.  If you are able to convert from Chapter 13 to Chapter 7, this can be done by notice.  It does not have to be brought by motion and the clerk will send out the notice of conversion to all of the creditors, the debtor and the debtor’s attorney and the trustee. 

If you are trying to convert from Chapter 7 to Chapter 13, then that has to be done by motion before the court and you need the court’s approval.