How to Convert a Chapter 7 to a Chapter 13 Bankruptcy

The ability to convert a Chapter 7 bankruptcy to a Chapter 13 bankruptcy is a viable option for most filers. The only time it is not an option is if the bankruptcy has previously been converted. A Chapter 13 bankruptcy involves repayment of part of the debt owed without losing assets, while a Chapter 7 is the liquidation of the debtors assets with no payments. Read on to learn more.

Instructions

Difficulty: Moderate

1. Check current income. In order to convert a Chapter 7 bankruptcy filing to a Chapter 13, there must be enough income to pay for the debts under a payment plan.
2. Verify debt levels. There are limits on secured debt and unsecured debt in order to convert to a Chapter 13. If the totals are too high, the filer is ineligible to convert the bankruptcy.
3. See a bankruptcy attorney. Bankruptcies are highly complex, and extremely hard to file without an attorney who is very familiar with the laws involved.
4. File a petition to the court. In some cases, it may be necessary to dismiss the Chapter 7 and re-file as a Chapter 13. For instance, if jobless when filing the Chapter 7 but gainfully employed presently, conversion would not be possible. The court would use the income level at the time the Chapter 7 was filed, so income levels would be too low to approve a repayment plan necessary for a Chapter 13.
5. Submit a repayment plan. This must be done within 15 days of the approval to convert.
6. Begin making payments on the Chapter 13 plan. Payments to the proposed plan start 30 days from the time the court approves the conversion.