Ch. 13 to Ch. 7 -- is it an option?

[vanzskater]

I had filed in November of last year for my ch. 13. My car was put on the plan as well as my lawyer fees. Well about a month and a half later I got laid off from my job. Two weeks later I had my meeting with the creditors and it was then the trustee was made aware of my recent news of not having a job. Now it's march, and my lender of the car (B of A, UGH) is objecting the ch. 13 demanding my payment be higher (my lawyer reported the car being worth $14k, and was taking off over $6k of negative equity) and I told her there would be no way of me making any higher payments as it is. I'm on a VERY fixed income with my unemployment benefits.

The hearing with B of A with me and my lawyer is on the 11th, and I'm wondering if I should try and get my case dismissed, give up the car, and roll into ch. 7? Do you think this is a good option for me? At this point I don't need the car, I will be moving to a big city where transportation is everywhere (whereas where I live now I needed my car for my commute for my job). I plan on meeting up with her ASAP (hopefully before the 11th) to see what my options are but...

any suggestions or opinions?

[EricaCallaha]

It might be a good option for you to convert to a 7 because of your job loss. Giving up the car would be good if you can walk away with no vehicle.

Are you going to be moving to a bigger city for a job that you already have or are you just going there because the prospects are better? That could play in also.

Good luck....Here's hoping you get what you need.

[vanzskater]

Thanks Erica for the positive post!
I'm moving to a bigger city because the prospects are better. The town I live in has an extremely high rate of unemployment and the job market is horrible. I can't live here without a car, but I know I would be fine in a big city being carless so I think that's the best option right now for me.

[woeisme]

Are you able to qualify for a CH 7 based on the 6-month look-back? If so, conversion might be your best option. We also had a job loss, but because we were so far over the mean when we filed, the trustee won't automatically allow a CH 7 even tho we now qualify because he wants to wait and see if our income recovers. So lawyer filed for a 3-month suspension in payments instead, and then will re-evaluate the case once that is over with. But I think if you qualified for a CH 7 before, then you might not have the same issue. Good luck!

[EricaCallaha]

I agree with Woe....If you were borderline before, in the 6 month lookback, you could easily fit inside the lines now.

Good luck on that job hunt. It is a killer out there.

[vanzskater]

Oh yeah I easily qualified for both in the 6 month look back. I make around 20-22k when I was working. Now my income dropped by 40%

[EricaCallaha]

Eeeek! I would really see if the conversion is right for you. It could all be really worth it in the end.

[vanzskater]

I think it would be, but getting hold of my lawyer seems to be so difficult. We have a hearing with Bank of America tomorrow because they want more money from my car.


I'm worried this hearing could cost me $$$ and was seeing if we could cancel it or something. Gahhh...

[EricaCallaha]

I hate it when lawyer's do that. They should have someone you could speak to that could give you some sort of answer. We have the best lawyer. Everytime I call, someone there can help me. If by some chance I have to leave a message, it is returned within 24 hours with an answer.

Here's hoping you get a hold of your lawyer today with your plans to seek conversion because of circumstance and a postponed hearing.....(Just in case you couldn't see...all of my fingers and toes are crossed for you!)

[vanzskater]

Those crossed fingers and toes paid off Erica
My paralegal called me, and it appears I can very easily switch to a ch. 7. She said she'd have to talk to my lawyer and see how much I owe (she guessed $1500 or so) and... *PHEW* a sigh of relief has come over me. She also told me I would have some time before giving up the car, so I can hopefully get all my plans arranged, finish up school next week, etc, and then give it up.

I'll know more within the next few days.

[EricaCallaha]

Thank goodness I can uncross them now! It was getting hard to walk and hold my son and referee my daughters.

I am so glad for you. I really think this is the right decision for you.

Keep me posted through this thread (I'll be watching for it) or PM me.

Erica

[EricaCallaha]

Just watch your money so you can finish paying up the lawyer, finish school (good job) and move on!

[vanzskater]

I'm very glad I decided to think of getting rid of the car as an option. The toughest part (which shouldn't be so hard) is just paying the fees for the ch. 7, that should only take me no more than three months to get that much money together (if not two) and then I can put all of this behind me I'll definitely post here tomorrow when I get word from my lawyer and what she wants to do.

[vanzskater]

Well after waiting nearly 3 weeks for my lawyer to get back to me they get in contact with me two days before I moved to Portland. Long story short, I gave up the car, and instead of converting to a 7, I'm still with a 13, but my payments are $100 for 36 months. I'm just paying legal fees with no interest, so that is good. I could switch but I could end up paying more with the 7.

But I'm happy and relieved I don't have a $400 payment anymore.

[lrprn]

Glad to hear that things worked out for you, VS. Thanks for the update!