Depending on your financial situation, you may find that converting from one type of bankruptcy to another is the best option for you. If you are considering filing for bankruptcy, it is important to understand the differences between Chapter 7 and Chapter 13 bankruptcy and when it might be beneficial to convert from one type of bankruptcy to another.
Below we will discuss the process of converting from Chapter 7 to Chapter 13 and vice versa, as well as the reasons why a person would want to convert their bankruptcy chapter and the associated costs. Contact The Law Offices of Melanie Tavare, to understand your legal options. Our bankruptcy attorney – Melanie Tavare – is committed to providing an outstanding level of legal representation to clients who need to file for bankruptcy or convert from Chapter 7 to Chapter 13 or vice versa.
Before discussing how one can convert from one type of bankruptcy to another, it is important to understand the basics of each chapter. A Chapter 7 bankruptcy is a liquidation bankruptcy that requires a debtor’s assets to be sold in order to pay off creditors. This type of bankruptcy generally takes four months or less and does not require debtors to make payments.
On the other hand, Chapter 13 bankruptcies are reorganization bankruptcies that allow debtors time (usually three-to-five years) to catch up on missed payments while under court supervision. The debtor makes regular payments during this period which goes toward paying off some or all of their debt.
No matter which chapter you choose, bankruptcy can provide a fresh financial start. In fact, filing for bankruptcy is not shameful. If you look at the statistics, you’ll see that millions of Americans have sought debt relief through bankruptcy. According to the website of the United States Courts, Americans filed 15.3 million non-business bankruptcy petitions in federal courts between October 1, 2005, and September 30, 2021.
There are several potential reasons why someone might choose to convert their filing from a Chapter 7 Bankruptcy case into a Chapter 13 Bankruptcy case. For example, if your income has increased significantly since you first filed for Chapter 7 or your property is going through foreclosure by creditors, then converting your case may be advantageous.
If you decide that conversion is the best option for you, then you must file an amended petition with the court and pay an additional fee in order for your request to be processed. It should also be noted that any fees associated with attorney representation during this process will vary depending on the location and legal representation chosen. Speak with our Oakland Chapter 13 bankruptcy attorney at The Law Offices of Melanie Tavare to discuss your particular situation.
In some cases, debtors may decide that converting their filing from a Chapter 13 Bankruptcy case into a Chapter 7 Bankruptcy case is more beneficial for them than continuing with their existing filing status.
Reasons for wanting such conversion could include job loss or a substantial decrease in income since initially filing or difficulty making monthly payments due under the terms of your current plan agreement. As with the conversion from a Chapter 7 filing into a Chapter 13 filing, if you decide that conversion is necessary, then an amended petition must be filed with the court along with an additional fee in order for your request to be processed; any additional fees associated with attorney representation will vary depending on location and legal representation chosen.
Bankruptcy can offer individuals struggling financially some much-needed relief. However, sometimes changing chapters can make more sense based on individual circumstances. There are both advantages and disadvantages associated with conversion, so it is important that anyone considering changing chapters consults with an experienced attorney who can assess their individual situation before proceeding.
The experienced bankruptcy attorney at The Law Offices of Melanie Tavare can review your situation and help you make an informed decision about what kind of chapter you should file under and whether or not it makes sense to convert. Reach out to our offices in Oakland or Hayward by calling 510 255 4646.
Wage garnishment is the worst-case scenario, at least in California. The Constitution and its amendments outlaw…
In the old days, financial stress during the holidays was a rite of passage. You knew…
If you are feeling stuck financially, your feelings are completely understandable. Even if you work full-time,…
Even though you may have seen other couples be there for each other in difficult…
If we lost our ability to socialize during the COVID-19 pandemic lockdowns, we began to…
More than half of small businesses close down and cease to operate within five years…