Converting to a Different Chapter from Chapter 13
Joliet Illinois Bankruptcy Lawyers & Attorneys
Jesse Barrientes: What happens though people – and you see it. I know you’ve seen it. I’ve seen it. People time and time again are coming back to a Joliet Chapter 13 bankruptcy attorney. Filing a Chapter 13. How many times can you file a Chapter 13 and still keep the wolves at bay?
David Siegel: Well, you can probably get one to three shots at it before the creditor brings a motion to bar you for 180 days from filing again. And that will allow the mortgage company enough time to foreclose and recover their interest in the property. Now let me talk about one thing though that I think is important with Chapter 13 and why it is so difficult to make these cases work. Because the majority of Chapter 13 cases that are filed, are not people who have lost their job and have become employed. And they’re not people have became ill and are now healthy. They are people who are sometimes are just living beyond their means and a Chapter 13 is not going to help. It’s just going to prolong the inevitable. If you don’t have the income to do a 13, and your budget doesn’t show available money, you’re doomed to fail.
Jesse Barrientes: Well what happens – you know, because we’ve talked about Chapter 7 before in terms of hey listen you just don’t have the money, complete discharge, and everything else. And you know if you make a certain income, you’re presumed that you can’t do a Chapter 7 in fact and you’re going to be stuck with the Chapter 13. But you can only do that if you have excess money. So okay, Chapter 13. I’m making, between my wife and I, we’re making a couple of hundred thousand dollars. Have you seen those? Is that what you’re talking about in terms of folks living above and beyond?
David Siegel: Oh, I don’t see incomes that high but I see debt that high. And it’s just a question of people who have over extended themselves on credit cards or made car purchases where they couldn’t really afford to make the payment. Those people have to do something different than a 13. They have to look to liquidate. Possibly convert the case to a Chapter 7 and just walk away from some of these items that they don’t have the ability to pay. So it really depends on the case. But there’s always the ability to convert to Chapter 7 if you would otherwise qualify for Chapter 7. So in other words, 13 is a good college try in many cases. If it doesn’t work you convert to 7.
Jesse Barrientes: Can you switch the other way? Say there’s a change in my circumstances and now I’d be able to sustain a payment.
David Siegel: You can. It has to be done with court permission and it has to be a honest change. It can’t be because you filed a Chapter 7 and the trustee found an asset that he was going to take and therefore now you want to do a Chapter 13 to save it. It has to be an honest situation where now you can make the payment. Or the trustee’s office thinks you have the ability to make the payment and they would probably convince the court of that. So it’s either the 7 is going to get thrown out, or convert the case to a Chapter 13 and attempt to repay some of your creditors over time.
Back to Aurora Illinois Bankruptcy Lawyers & Attorneys
Chapter 7
What’s needed to file a Chapter 7 case?
Stay on creditors during a Chapter 7 case
Mistakes made in a Chapter 7 case
Listing creditors in a Chapter 7 case
Credit counseling classes in a Chapter 7 case
Notice to creditors in a Chapter 7 case
There is life after bankruptcy
Chapter 13
Saving your home with a Chapter 13
Stopping a sheriff sale using Chapter 13
Converting to a different chapter from Chapter 13
