Chapter 7 Dismissal, Filing 13 in several months, how much time before we are sued?

[dontburnthep]

We are one of the lucky ones who filed pre-Ransom decision but had our 341 post-Random decision, and lost the ownership deduction on our means test. (Our district did accept the deduction pre-Ransom.) So we are looking at a dismissal. We pre-planned for a 7, not a 13, and are not prepared to convert to a 13 at this time. Is it possible to allow the 7 to be dismissed, then wait a few months to get our situation more able to deal with a 13 for 5 years? We have 2 very old vehicles that will not survive a 5 year plan. We received a one time bonus in October, so we really need to let that pass the 6 month look back as well, when calculating a payment plan under 13. (It didn't matter in a 7 because we easily passed the means test with the ownership deduction.) If we let the 7 be dismissed, about how long might we have before the creditors come after us? We have about 70K in unsecured debt, and 85K on a house that we have vacated. We were about 40 days past due when we filed the 7. We have no assets and we live in NC which I believe, is a no garnishment state.

[newbie2]

You cannot be forced in to a Chapter 13. Pre-planning for it is wise, so take your time and make sure that when you do you get in to a plan that is workable for you and your family. As far as your creditors sueing, none of us can guess what your creditors will do, or their timeframe. Some are very quick to sue, others never do. Good luck to you.

[dontburnthep]

After speaking with my attorney several times, he indicates that pre-planning of this type is fraud and that the trustee will look back at our original petition and question what expenses changed.

Since a chapter 13 is now forward looking, I don't understand how planning for the 5 years you would be in the plan is fraud.

There is no possible way we can successfully complete a 13 with the numbers we used on our 7 petition. Since those numbers are a look back, instead of forward, and we were paying on our debts almost to the date of filing, they simply aren't accurate numbers for a 13. We were barely scraping by.

He also got very irritated with me about some of my questions, including how many of his chapter 13's make it to discharge. (20%)

I also think that if he had been aware of the Ransom ruling coming down, he'd have advised us to plan better BEFORE the 7. He should have been aware, and I should have asked better questions. We filed less than 2 weeks before the ruling.

[DebtEnder]

Sounds like you have a wuss for an attorney, and also likes to keep his head buried. He has already wasted your cash on a failed ch7, go find a new one. Waiting to file until big lump sum payments, and getting new cars before possibly getting stuck in a 5 year plan is not fraud, just good sense.

[biotechsolution]

Like the above poster stated , you can't be forced into a chapter 13. Just let your 7 be dismissed and re-file when you are ready.

[dontburnthep]

Thank you. That's where I'm leaning.

But now I'm fearful of what is or isn't fraud. I work from home, and haven't been able to afford childcare while we were paying our creditors- can I put my kids in child care now? We had planned to do so once the 7 was discharged, I really cannot see 5 more years of working full time with 2 children here, but since we didn't have them in care for the 6 months prior to the 7, we can't use it if we converted to a 13. Attorney says no way. I say no way I will be able to keep my job for the 5 years of the plan without child care.

If we have to do a 13, I desperately want it to be successful and it simply won't with the chapter 7 numbers.

[ValleYum]

Get a new attorney. The chapter 13 trustees are totally separate from the chapter 7 trustees - would they even know what your numbers for your old 7 attempt were?

I would simply take the time you need to be able to <ahem> afford your new lawyer. As for your kids: It's "pre-school" or "after school homework and activities" not just childcare. You want them to become more social and you want your job security. It simply was too difficult to work and watch X number of children while turning in an acceptable job performance.

[LadyInTheRed]

I'd hate to contridict an attorney's advice and maybe there are details we are missing here. But, I can't see how waiting a few months after the dismissal of a 7 to file a 13 would be fraud. The Ransom decision made you suddenly ineligbile for a 7. For all the court knows, you never would have filed if you knew 13 was your only option. After a few months of trying to make things work without BK, you realized you needed to file even if it had to be a 13. I don't think you would ever even need to explain yourself.

Even though the trustee would be different, the Chap 7 filing would have to be disclosed in the Chap 13 petition and the Chap 13 trustee can go look at your Chap 7 filing. But, as long as there are no changes between the two filings that you can't explain, I don't see how that would be a problem.

I agree that you need another attorney.

[dontburnthep]

Thank you!

I specifically asked him about replacing our vehicles, child care, and medical & dental care that we have not adequately maintained while trying to stay afloat over the past few years. Those are the things that he said would be fraud if we let the 7 be dismissed, made the changes, and refiled a 13 later. He said it would likely get the new case dismissed for totality of the circumstances, based on the changes from the old case.

He told us he'd get us the 7, that we were above median but easily passed the means test and with the vehicle deduction, that looked to be true to me as well. We really wouldn't have filed - at the time that we did - had we known it was likely we'd end up in a 13. We'd have taken the time to preplan. We thought we didn't need to worry about catching up on things like medical and vehicle maintenance beforehand because we'd have our 7 discharge.

My fault for trusting him and not asking more questions. I actually DID question the vehicle ownership deduction because at $496 it seemed ridiculously high, but he assured me that it was accepted in our district. (Which it was, until 1/11 when Ransom was decided.)

I'm not opposed to a 13- really not at all, as long as the payment is a reflection of all of the legitimate deductions that we are entitled to, and with the current numbers, it isn't.