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Converting Your Chapter 13 Bankruptcy to Chapter 7 in Missouri

You might be able to switch your case to a Chapter 7 bankruptcy if you are no longer able to afford to make your Chapter 13 bankruptcy plan payment. But bear in mind that converting your chapter 13 bankruptcy to chapter 7 is a complex process. In order to finish your case and get a Chapter 7 discharge, you must still meet the requirements for Chapter 7 bankruptcy.

To successfully convert your Chapter 13 bankruptcy to a Chapter 7 filing, legal advice is required. You can get in touch with our Kansas City bankruptcy attorneys who know exactly how to switch from Chapter 13 to Chapter 7 bankruptcy by contacting the Jeppson Law Office for assistance. For more than ten years, Jeppson Law Office has provided legal services to residents of Greater Kansas City. 

Our bankruptcy lawyers work to make things convenient for our clients by offering flat-rate plans and flexible appointment scheduling times throughout the week. Contact us now!

Why do I need a Bankruptcy Attorney in Missouri?

Most people seeking debt relief will go to great lengths to regain financial independence. It’s crucial to obtain information on how to convert Chapter 13 to Chapter 7 bankruptcy from a bankruptcy lawyer who does the following:

  • Especially in light of how daunting and perplexing the bankruptcy proceedings can be, the attorney sets fair expectations for each client.
  • Ensures that the bankruptcy procedure is as efficiently streamlined as possible.
  • Make every effort to reduce stress while ensuring that your legal rights are upheld.
  • Works diligently to improve each client’s financial future by assisting them in overcoming obstacles.

Contact our Kansas City bankruptcy attorney right away if you want to learn the bankruptcy process to convert your Chapter 7 bankruptcy to Chapter 13 and how to put your finances back on track.

 

What is Chapter 7 bankruptcy? 

Chapter 7 bankruptcy, also known as “liquidation,” is the collection and sale of part or all of your non-exempt Missouri assets by a bankruptcy trustee. Your debt will be settled with the proceeds from the liquidation procedure. A successful Chapter 7 filing will be in effect for three to six months.

To avoid having your belongings stolen from you, it is essential to understand which of your possessions qualify for bankruptcy exemption. Your automobile, social security, and other personal items like clothing are generally yours to keep. After speaking with our Missouri bankruptcy lawyer regarding these bankruptcy exemptions, you should have a better understanding of what to anticipate when changing your Chapter 13 bankruptcy to Chapter 7.

 

What is Chapter 13 bankruptcy? 

In a Chapter 13 bankruptcy, also referred to as an individual or consumer reorganization, the petitioner is not required to forfeit any real estate or other assets. Instead, you’ll be able to create a debt settlement plan that will enable you to gradually pay off your debt over the course of three to five years.

Being eligible to file a Chapter 13 bankruptcy petition depends heavily on having a consistent source of income. It is also regarded as the bankruptcy chapter that will aid you the most because it gives you more chances to make on-time payments or even your monthly payment on your debts. The minimum Chapter 13 payment you must make is based on your income, debt, and the amount of unsecured debt that the unsecured creditors would have gotten had you chosen to file for Chapter 7 bankruptcy.

Get in touch with our Kansas City bankruptcy lawyer to determine whether converting from a Chapter 13 bankruptcy to a Chapter 7 bankruptcy is the best option for your case. 

 

Why Do You Need to Convert Chapter  13 to Chapter?

There are several issues that Chapter 13 can help with. However, following through on a plan is difficult—especially if you have a job loss, a health issue, an accident, or another incident that lowers your income.

You may be able to switch your case to a Chapter 7 bankruptcy if you can no longer afford to pay your Chapter 13 plan installments.

The majority of borrowers experience issues with Chapter 13 bankruptcy when:

  • A change in their financial situation makes it impossible for them to continue making Chapter 13 plan payments, or
  • They want to get rid of something that Chapter 13 was made to save, such as a house or car.

However, the case will be dismissed if the debtor stops making payments. The payments will be credited to the debtor, who is still liable for any remaining obligations. A Chapter 7 conversion, on the other hand, enables the debtor to discharge (erase) all eligible debt.

 

Are You Eligible to Convert a Chapter 13 Bankruptcy to a Chapter 7 Case?

To be able to convert Chapter 13 to Chapter 7. . .

  • You must pass the Chapter 7 means test to become eligible for Chapter 7 before filing. You can afford to pay off some debts through a Chapter 13 plan, provided you pass the means test, which examines your income and expenses. You cannot qualify for Chapter 7 if you can. Passing the means test, either formally or inferentially, is the primary barrier to conversion to Chapter 7

Although the district court does not mandate that debtors pass the means test before switching from Chapter 13 to Chapter 7, the Chapter 7 trustee assigned to your case will review your revised income and expense declarations. 

  • If your budget shows you have money left over after paying your debts in full or partly, the bankruptcy court will reject the conversion. This prevents debtors with significant assets and income from filing under Chapter 13 and then switching to Chapter 7 to avoid repaying more of their obligations. It does not necessarily follow that if your circumstances have changed since you first filed for bankruptcy under Chapter 13 you will not be able to satisfy the means test now.

You must take note that passing the means test, either formally or inferentially, is the primary barrier to conversion to Chapter 7

 

How to Convert your Chapter 13 Bankruptcy to a Chapter 17? 

It is necessary to ascertain your eligibility and plan for the disposition of your property before converting Chapter 13 to Chapter 7. In most cases, qualifying is not a problem because many people convert due to a decreased income or a loss of employment. When you filed for Chapter 13, you may have hoped to protect certain property, but this is not guaranteed. 

  1. You can transfer most of the bankruptcy documents you filed for Chapter 13 to your Chapter 7 case. 
  2. If your income, debts, and expenses have changed, you will need to update some of the bankruptcy forms. In a very simple manner, if they are dischargeable, those accrued debts that you file under Chapter 13 may be included and eliminated in the Chapter 7 case. 
  3. Even if your circumstances have not changed, you could be required to resubmit the same information in some states. Forms about the means test and any secured debts must also be submitted.
  4. Creditors’ proof of claims will immediately be transferred from the Chapter 13 case to the Chapter 7 proceeding. If extra money becomes available to a debt collector after the sale of non-exempt property, they may be given a chance to file new proofs of claim. You can keep any property you purchase after the initial Chapter 13 filing date if any exemptions are to be used.
  5. A new meeting of creditors will be required of you; this meeting might not be the same as the one in your Chapter 13 case.

 

Call our Kansas City Bankruptcy Attorney Now!

Having a lawyer on your side could mean the difference between your debt continuing to mount and becoming debt-free when you are facing financial difficulties. Your Chapter 13 bankruptcy and any other bankruptcy case can be converted to Chapter 7 by one of our attorneys at Jeppson Law Office because they have the requisite skills.

Set up a free consultation with our Kansas City bankruptcy lawyer right away if you want to give your financial situation a much-needed fresh start. We also provide top-notch legal services in other professional areas, including bankruptcy and divorce.

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