Ch13 to Ch7 Conversion Question

[Anonymous]

I apologize if this has been covered but I couldnt find what I was looking for in a search. We filed Ch13 Dec 2017, started making regular payments Jan 2018, plan confirmed May 2018, and have made all payments including 2017 tax return to Trustee on time. Our confirmed plan current disposable income matches my wife's total monthly income. She has an ongoing medical condition that will require surgery in July and will take her out of the work force for 6 months to a year. During our 341 Meeting in Jan 2018 we did disclose this surgery requirement when the Trustee asked if we had any upcoming projected change in income. We have asked our Attorney for guidance on what our next move should be because once she is done working we wont be able to maintain our plan payment but he refuses to discuss our case until the event occurs. To further complicate matters we are relocating to another state shortly after my wife's surgery and it's unknown if she will be able to secure employment after she recovers. My concern is while waiting for our Attorney to act, we will fall behind on plan payments and risk dismissal. Has anyone been in a similar situation? Would Ch13 to Ch7 conversion be an option in this case? If so and the conversion is submitted to the Court, are we mandated to continue making plan payments up to the new 341 meeting or other event? Thank you in advance.

[Anonymous]

I, myself filed for ch13 and converted to ch7.

After 6 months and your wife’s income falls off then you can convert to 7 if you pass the means test.

I filed ch13 September 2017 made all payments until January. Filed for ch7 in March2018. Did not pay ch13 plan in January and February. Trustee requested wages be deducted from my pay in March. Same day I filed Ch7 and he did not take my wages and a week later my case was dismissed but still was covered and no one could contact me or garnish my pay. I am not discharged and so glad this whole process is over.

So yes you can do it. You just have to wait for your wife’s income to fall off. Depending where you move also, if it’s a different state you can see if you qualify for the means test there. Each states is different.

[Anonymous]

Thank you for the response. I was hoping to not have to go delinquent on Trustee payments and certainly don’t want to risk dismissal. I’ve been researching a Special Circumstances Affadavit which should document that there will be no improvement in income for at least 6 months to 1 year. My Attorney isn’t being very helpful and is stating that my plan payment will have to be modified because the Trustee will want to “punish” me as opposed to “letting me off”. Problem is we are already in a 60 month plan and after secured payments and Trustee fee we would be far below the minimum Federal/Local living standards. If our plan payment was modified to cover only the secured payments and Trustee fee, we would be left with about $1,000 total per month to cover all expenses which is below the approximately $1,700 per month in standards for my household. Am I missing something?

[Shooting-For-800]

as long as you qualify for chapter 7, you can file chapter 7.

there are also options to reorganize your 13 to change payments or may even be able to skip a few if your income has dramatically changed.

[Anonymous]

Thank you. When we filed we didnt qualify for Ch7 because our income was about $3,000/month over the median. We are now losing about $4,700/month in household income. We are attempting to draft a Special Circumstances Affadavit to document that there is no hope of that income returning any time in the next year but our Attorney isnt communicating.

[Shooting-For-800]

Did your attorney tell you that you were over the income limit or the trustee?

I was over the limit and 3 attorneys told me there was no way in the world to do a 7.

I did a 7.  And I did it on my own without an attorney and did not fudge a thing.

BK attorneys often want the easiest route to make thier $1,500-$3,000 with 3 hours of paralegal work.

Anyway, Good Luck.  The laws were made to help those who really need it, so you will be ok one way or another.

[Anonymous]

How to apply for chapter 13 or 7