Chapter 13 to Chapter 7, Any advice?

[baseballphilly]

Background Info: I am new to this site and have a question regarding converting from a 13 to a 7. I will try my best to explain all the details. My wife and I filed Chpt 13 in Dec 06, we pay 950 a month@ 100% payback. We currently have about 42,000 left in the plan, Secured creditors amounts to about $12k, the rest is unsecured creditors. When we filed, our house was worth 335k, we owed 245k on the 1st and 16k on the second. We were under the mean income level in Virginia by 2k, but due to the equity in our house, we had to file a 13. At the time our mortgage on the 1st was $2044, and we were 2 months behind, which got oput into arrears in the 13. Right after we were confirmed, our Arm reset and our rate went from 7.3% to 10.5%, which made our new payment $2659. This includes taxes and insurance. We have been current on all of our 13 payments, but have fallen behind on house, 1 month going on 2. In January, EMC filed a motion to have the automatic stay lifted. Our lawyer was able to get us 60 days to refinance or sell the house, mainly because we did not agree to pay the late mortgage and fees over 6 months, due to the fact our new payment would have been $3100. We cannot refinance because our house is now worth 295k and we have been late. So, here our my questions

Can we surrender the house and convert to a chpt 7?
I ask this because houses are taking 5-6 months to sell in my area. Any input would be helpful, and if anyone needs more info, let me know. Thanks BaseballPhilly

[coma]

You can, but you have to qualify for a CH7.

[car67]

I asked my attorney this very question......
If the arm adjusts while in Chapt 13 can the increase in mortgage
payment be reported to the court to make a modification of the
payment distribution.... In other words rather then your creditors
getting 100% your attorney files for a new payment based on economical
changes in your budget. The attorney fees are priority anyway in the plan
and they leap frog over money going to creditors so I would think your attorney
should be more then happy to hop in and make a filing to offer less to the unsecureds
so you can keep your home....... The attorney gets fees for the filing you get to keep home and the unsecured gets less. Thats why you filed Chap 13 to keep your home and regroup over 5 years.....

[car67]

In other words I am told if your mortgage goes up yes you can ask for a new payment
in the 13 plan to allow for this added expense? Of if your just really tired of paying for the
home just stop paying the 13 and mortgage wait for the foreclosure and live rent free save your cash get a rental somewhere and hunker down and file 7 after the foreclosure dust settles and your all moved and ready

[coma]

In other words I am told if your mortgage goes up yes you can ask for a new payment
in the 13 plan to allow for this added expense? Of if your just really tired of paying for the
home just stop paying the 13 and mortgage wait for the foreclosure and live rent free save your cash get a rental somewhere and hunker down and file 7 after the foreclosure dust settles and your all moved and ready

You can get the plan modified. The thing to consider is if it's worth it. If you are way upsidedown or will not be able to afford the home after disharge, it may be best to let it go. Just consider all the options, so you don't go through bankruptcy and not get the mos out of yourfresh start