Converting Your Chapter 7 Bankruptcy to Chapter 13

In some cases, people file for Chapter 7 bankruptcy and then realize that Chapter 13 is a better option. The question is, can you do it legally? The quick answer is yes. Sometimes, your financial problems push you to change your mind. On the other hand, the bankruptcy court may request that you convert to another bankruptcy option. That’s completely alright, as long as it is done in a legal manner. 

Converting Chapter 7 to Chapter 13 requires the legal help of an excellent bankruptcy lawyer. As the Bankruptcy process is naturally complex, every step you undertake is crucial. You should consider hiring an experienced, expert, and reputable bankruptcy attorney. 

In Oregon, Michael D. O’Brien & Associates, P.C. is a bankruptcy law firm that can help. With our extensive experience in handling and resolving complicated bankruptcy cases, you can put your trust in us in converting your Chapter 7 Bankruptcy to Chapter 13. If you want to discuss your case with us, schedule a free case evaluation now!

In selecting the best bankruptcy lawyer in Oregon, take note of the following qualities – proficient, competent, and negotiable. As far as Michael D. O’Brien & Associates, P.C. is concerned, these are just some of their unique qualities as an excellent bankruptcy firm in Oregon. With over 26 years of practicing bankruptcy, our knowledge in bankruptcy laws is exceptional. 

There is no question that our law office is deemed an expert in bankruptcy laws in Oregon. As a matter of fact, two out of three nationally- certified bankruptcy lawyers in the state are part of our team. We deeply understand that your finances are at stake, hence, we are open to negotiation, especially for attorney fees. If you or someone you know is in need of converting Chapter 7 Bankruptcy to Chapter 13, make an appointment now!

In Chapter 7 Bankruptcy, debtors are given a fresh start by allowing them to discharge most of their debts. In this type of bankruptcy, the debtor will give up non-exempt assets for liquidation. On the other hand, Chapter 13 Bankruptcy allows the debtors to make a repayment plan for 3-5 years to pay off the debts. This is referred to as the wage-earner plan. In Chapter 13, the debtors are provided an option to keep their assets and properties. Only debtors with regular income are eligible for this type of bankruptcy. 

A fundamental difference between the two is the period of time it takes to be deemed completed. In most cases, Chapter 7 Bankruptcy completes within 3-4 months, albeit other cases take longer. On one hand, Chapter 13 can last up to 5 years.

Common reasons for converting Chapter 7 to Chapter 13 Bankruptcy

There are various reasons why individuals may voluntarily switch from Chapter 7 to Chapter 13 Bankruptcy. In particular situations, the bankruptcy or the trustee may also request a debtor to convert. Some debtors also realize that Chapter 13 is better than Chapter 7 after filing the latter. In these cases, the debtor may initiate the conversion. Examples of such situations include a debtor who:

• Accidentally missed to disclose an imperative asset in Chapter 7 filing;
• Unable to construe the coverage of Chapter 7 Bankruptcy discharge accurately;
• Undermined the amount of assets, and thereafter determines that the exclusion does not include all of the debtor’s property; or
• Had a sudden change due to unexpected financial circumstances 

In these types of situations, converting Chapter 13 may be the best option available than pursuing your Chapter 7 case.

Steps in Converting Chapter 7 to Chapter 13 Bankruptcy

While the bankruptcy state law is by nature complicated, the process is straightforward. Almost all courts in Oregon will permit you to convert from Chapter 7 to Chapter 13 Bankruptcy. To convert, you need to do the following:

• Seek permission from the court by filing a motion.
• Convey the motion to the bankruptcy trustee, creditors, U.S. Trustee, and other interested parties. 
• Be present at the short hearing.

If nobody contends your motion, the bankruptcy court will then grant your request without needing to conduct a hearing. However, there are also other courts that take a higher degree of diligence that may request you to comply with the further rules. While this is the situation, it is therefore necessary to have an expert bankruptcy attorney with you who is knowledgeable about the local rules of your state. 

What May Hinder You From Converting Chapter 7 to Chapter 13?

In every rule, there are exemptions. Even if the process of conversion of the type of bankruptcy is straightforward, some instances really exist where you are not allowed to convert to Chapter 13:

• You are ineligible for Chapter 13 Bankruptcy – In converting from Chapter 7 to Chapter 13, it will seem as if you are filing for Chapter 13 Bankruptcy. Thus, it is still important to meet the necessary qualifications of Chapter 13. If otherwise, you are not allowed to convert. In Chapter 13 Bankruptcy, once of the salient requirements is to have a stable income and lesser debt you owe.

• You acted in bad faith – In some cases, the court may have declared that you acted in bad faith. If this was declared by virtue of strong evidence, you could not convert your Chapter 7 Bankruptcy to Chapter 13. In most cases, a person can be deemed to have acted in bad faith if he or she covers up assets that the Chapter 7 trustee discovers.

• You previously made a conversion – There is little to no chance that the bankruptcy court will still grant your permission to convert if you have converted your Chapter 13 to Chapter 7 bankruptcy previously. If, for example, you previously converted your Chapter 13 to Chapter 7 in response to a court or trustee request, you are no longer permitted to return to Chapter 13. 

The primary reason why you convert into another type of bankruptcy is for your financial stability. As bankruptcy gives you a fresh start, choosing the appropriate type is imperative. This may appear complex to you, but with the assistance of an experienced bankruptcy attorney, your financial situation will be in good hands. While it may seem unrealistic to search for a bankruptcy firm that employs two of Oregon’s three nationally-certified consumer attorneys, Michael D. O’Brien & Associates, P.C. is that firm.

Other than providing legal aid in converting Chapter 13 to Chapter 7, we also handle debt alternatives, and estate planning. If you or someone you know is looking for an affordable legal service while remaining excellent, Michael D. O’Brien & Associates, P.C. is the best choice. You may schedule a free case evaluation today!