Conversion of Chapter 7 Bankruptcy to a Chapter 13 Bankruptcy
You have the right as a debtor to convert your Chapter 7 liquidation bankruptcy to a Chapter 13 bankruptcy reorganization. While this is not done very often, there are some circumstances that warrant this conversion. However, if you attempted to file a Chapter 7 bankruptcy and at some point were denied due to the fact that you were unable to pass the mandatory means test, you may be able to withdraw your Chapter 7 bankruptcy case, or instead convert it to a Chapter 13 bankruptcy reorganization case.
Payments under Chapter 13 Bankruptcy
If you make the decision to file for Chapter 13 bankruptcy instead of Chapter 7 bankruptcy, you will need to ensure that you file a repayment plan within 15 days of the conversion. Additionally, you must make payments on the reorganization of your debts within 30 days following the submission of a repayment plan. In most cases, a Chapter 13 bankruptcy will last anywhere from 3 to 5 years depending on the amount of debt owed and the amount of disposable income available each month to pay those debts. If for some reason a debtor’s reorganization plan is not approved by a bankruptcy court after several attempts, the bankruptcy case will be dismissed.
Conversion to Chapter 7 from Chapter 13
In some cases, the opposite scenario happens, and a debtor wants to convert a Chapter 13 bankruptcy into a Chapter 7 bankruptcy. This may be because the debtor is unable to make their monthly payments under the established reorganization plan, the debtor wants to surrender property that they were originally trying to keep under the Chapter 13 bankruptcy, or the debtor realizes that it is for the best for them financially to be able to have many of their debts discharged instead of reorganized. If a debtor attempts to convert a Chapter 13 bankruptcy to a Chapter 7 bankruptcy, they will still have to pass a means test in order to be approved for this type of bankruptcy and the discharge of debts.
Chapter 7 or Chapter 13
While it is possible to convert one bankruptcy into a different kind of bankruptcy, it is always better to simply start off correctly with the most appropriate type of bankruptcy for your unique financial situation. Visiting with an experienced bankruptcy attorney before you start the process can help ensure that you file the best type of bankruptcy for your financial needs.
Contact an Experienced Bankruptcy Attorney
If you are considering filing for either Chapter 7 or Chapter 13 bankruptcy, or if you have made the decision to convert one type of bankruptcy into a different type of bankruptcy, you should contact an experienced bankruptcy attorney today to help you make the best decision for your financial situation. Contact a West Palm Beach bankruptcy attorney at Kelley, Fulton & Kaplan at 561-264-6850 for a free consultation, and to help you understand which type of bankruptcy is best for you.