What Happens If I Cannot Complete My Chapter 13 Plan (Part Two)
By Kevin Gipson, New Orleans Bankruptcy Attorney on Feb 11, 2007 in Bankruptcy Practice and Procedure, Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, General Bankruptcy Information
In Part One of this topic we discussed modification of a Chapter 13 plan.
In this second part, we will discuss converting a Chapter 13 bankruptcy into a Chapter 7 bankruptcy.
You as a debtor have an absolute right to convert from a Chapter 7 to a Chapter 13 case.
In order to convert the following actions must occur:
- A Chapter 7 means test must be completed;
- A Statement of Intentions with regard to your secured debts must be filed;
- If new debts have been incurred since the filing of the Chapter 13 bankruptcy the schedules of debts must be supplemented to reflect the new debt; and
- A Chapter 7 Meeting of Creditors will be scheduled.
In addition to financial reasons of a change in circumstances making a Chapter 13 plan no longer feasible, there are other reasons to convert to a Chapter 7 plan.
Among these reasons is if the asset(s) sought to be protected by the Chapter 13 plan or destroyed, if they have been lawfully repossessed by a creditor or if the asset(s) is no longer of value to the debtor.
In Part Three we will discuss the Hardship Discharge.
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