Is it possible to convert a Chapter 7 to Chapter 13 after Discharge?

[huskerburn]

Hi all, I am new to the forum and am wondering if it is possible to convert a chapter 7 to a chapter 13 after discharge? I apologize if this has been discussed in a prior thread. I am not sure my original attorney led me in the right direction. I am in the middle of a divorce and am facing 2 mortgages that I can not afford to contribute to and a disputed amount owed to my current wife for business related debt to her. I was instructed by my atty that filing a chapter 7 was the way to go prior to the final divorce judgement/decree being issued. I am now concerned that it might have been in my best interest to file a chapter 13 after the divorce to minimize the debt equalization payment she is seeking? My chapter 7 was a no asset case and was discharged three weeks ago. I surrendered everything except my 401k, clothes, and re-affirmed my truck. My wife is extremely financially well off and has been making the payments on things for years so my bk didn't affect her in anyway. She has kept current on all the mortgages. I am currently living with family and am just able to make ends meet right now as I work in the construction/real estate industry. Any advice? Thanks! JK

[AngelinaCat]

Hi huskerburn: welcome to the forum. You don't need to convert. Once your Ch7 is discharged and closed, you can then turn around a file a Ch13 the next day if you want to. This strategy is useful for those who owe huge amounts to the IRS and are not able to work out a payment plan plan with them.

I hope this helps!

[huskerburn]

Hi AnjelinaCat, thanks for the response. I thought there were certain time limitations as to the subsequent filings of each chapter and their discharges? How would this work in my case? I thought you had to wait 4 years after filing a chapter 7 to file a chapter 13? I am a little confused. Thanks

[AngelinaCat]

You have to wait for 8 years in order to file another Ch7. There seems not to be a limitation in filing a Ch13 right after a Ch7. Another poster, Southernbelle, is contemplating a similar path due to heavy IRS debt and a nasty divorce. The timing question is what caused me to research it.

You might want to peruse some of her posts:

http://www.bkforum.com/search.php?searchid=1447954

We have a heavy IRS debt--thankfully, no divorce issues--and have been thinking about it ourselves.

I hope this helps. Good luck,

[HHM]

Let's back up a bit, there is some incorrect information in this thread.

1. Once your case is discharged, your case is over.
2. You can always "file" a chapter 13, but the issue is whether you need a discharge from the chatper 13. You cannot receive a discharge of a chapter 13 until 4 years after your chapter 7 case.

[AngelinaCat]

HHM is correct. Here is what the Nolopress.com book on Ch 7 bankruptcy says:

"You can file what some bankruptcy practitioners call a “Chapter 20” bankruptcy—that is, file for Chapter 13 bankruptcy immediately after completing a Chapter 7 bankruptcy. You use the Chapter 13 bankruptcy to deal with any liens remaining after your Chapter 7 case has wiped out your personal liability. And, if the lien exceeds the value of the property, you can often get the lien fully discharged by simply paying the current
replacement value of the item, rather than the full amount of the lien.

You can do this only if the Chapter 13 plan lasts at least four years past the date when you filed for Chapter 7 bankruptcy. The new bankruptcy law prohibits you from receiving a Chapter 13 discharge within four years of filing a Chapter 7 case in which a discharge was granted."

When I looked it up to see if we could file, I was looking long term because I think we will be repaying IRS for the rest of our lives. We have worked out a payment plan, so this option may not be necessary for us.

I am apologize if I mis-led the OP.

[huskerburn]

Thanks HMM for clarifying. So, from what you have explained would it be possible to file a new chapter 13 immediately (roughly 4 months after my 7 filing, 1 month after my 7 discharge) and have the plan set for 4 years to make it eligible for a discharge? Or, would I have to wait the four years before refiling to be eligible for a 13 discharge?

I also read that most municipalities will let you convert a chapter 7 to a 13 at anytime even after discharge? Do you know if this statement is accurate? Thanks, JK

[justbroke]

Thanks HMM for clarifying. So, from what you have explained would it be possible to file a new chapter 13 immediately (roughly 4 months after my 7 filing, 1 month after my 7 discharge) and have the plan set for 4 years to make it eligible for a discharge? Or, would I have to wait the four years before refiling to be eligible for a 13 discharge?

If you need a discharge in a subsequent Chapter 13, you would need to file that Chapter 13 at least four (4) years after having received your Chapter 7 discharge.

I also read that most municipalities will let you convert a chapter 7 to a 13 at anytime even after discharge? Do you know if this statement is accurate? Thanks, JK

You don't convert. You file a new case. A Chapter 13 can be files at anytime, as HHM pointed out, but you will not receive a discharge if you received one in a Chapter 7 in the two years prior to filing.

What are you trying to do?