How to Convert Chapter 11 to Chapter 13
A debtor filing for bankruptcy under Chapter 11 is usually a corporate entity seeking to reorganize its debt. According to U.S. Courts, "a Chapter 11 debtor usually proposes a plan of reorganization to keep its business alive and pay creditors over time." Some individual debtors may also attempt to reorganize debt under Chapter 11 bankruptcy. If they are unable to complete their Chapter 11 case they may convert to Chapter 13 bankruptcy at any time.
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Instructions
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How to Convert 11 to Chapter 13
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Make sure your Chapter 11 bankruptcy case has not gone through. A debtor cannot convert his case to a Chapter 13 bankruptcy if he has already been discharged under Chapter 11 bankruptcy.
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Check your debt levels to see if you are eligible for Chapter 13 bankruptcy. To convert to Chapter 13 bankruptcy, the debtor must have less than $1,081,400 in secured debts and $360,475 in unsecured debts.
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File a motion with the bankruptcy court handling your Chapter 11 case asking for permission to convert. Under Chapter 13 a debtor may only voluntarily begin a bankruptcy case unlike in the Chapter 7 or Chapter 11 cases where creditors can force the debtor into a bankruptcy case. The motion should clearly state the grounds under which the debtor wants to convert and the reasons for moving to convert.
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Serve the motion to convert on all interested parties. The debtor must serve a copy of the motion on each of his creditors, the debtor in possession and the trustee, if a trustee has been appointed. The bankruptcy judge will decide whether to grant or deny the motion and issue an order based on his decision.
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Tips & Warnings
Take the help of an experienced bankruptcy attorney while attempting to convert from Chapter 11 to Chapter 13.
Mistakes can cause your case to be dismissed.
Creditors may object to the motion to convert.
References
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