Filing for a Chapter 13 bankruptcy gives you the opportunity to reorganize your debts and get back on track with your financial life. As long as you practice proper money management after working with a bankruptcy attorney, you can pay back your debt as quickly as possible. However, whether it’s job loss, a personal emergency, or something completely unexpected, a situation could arise that prevents you from repaying your debt – even if you’ve already filed for a Chapter 13 bankruptcy. So what’s next?
When to Convert a Chapter 13 Bankruptcy
If you’ve reorganized your debts under a Chapter 13 filing and still can’t pay them back, you might want to consider converting to a Chapter 7. Even if you worked with a bankruptcy attorney for your Chapter 13 filing, changed circumstances can change your ability to repay your debts. Fortunately, as long as you haven’t filed for a Chapter 7 bankruptcy in the last eight years, you can convert your Chapter 13 bankruptcy to discharge the debts you cannot repay.
How to convert your bankruptcy type. If you’ve already had a repayment plan established under Chapter 13, working with a bankruptcy attorney will improve your chances of having the conversion approved. You must file a motion with the court. Most of the time, the paperwork you completed for your Chapter 13 filing is all you need, but, sometimes, additional paperwork will be required. If this is the case, feel free to work with your bankruptcy attorney to ensure that you have all the appropriate forms completed.
If you’re eligible for Chapter 7. In order to convert from a Chapter 13 to a Chapter 7 bankruptcy, you must be eligible for Chapter 7. Working with a Fort Worth bankruptcy attorney will help you determine whether or not you’re even qualified for a Chapter 7 discharge in the first place. Perhaps the most important eligibility requirement is passing the “means test,” which measures your ability to repay the debt.