Assessing Your Financial Situation
The examination of your financial situation is one of the important steps in a bankruptcy conversion. This is the stage where you and the attorney explore your finances in detail. The relevant debts are about what are called secured debts (car loans, property division debt, etc). Your bankruptcy attorney will help you understand whether you qualify for a Chapter 7 conversion based on these debts.
Factors in converting your loan include the means test, your ability to pay creditors, etc. Because available forms of debt relief include liquidation of your assets and resolution of your debts on terms that are fair to you, it is essential for you and your attorney to carefully evaluate your current budget situation and the fair market value of your assets.
Eligibility Criteria for Chapter 7 Conversion
To convert from Chapter 13 to Chapter 7 bankruptcy, you need to meet certain eligibility requirements defined by the bankruptcy system. One of the requirements is to pass the means test, which looks at your income and expenses.
You should have an experienced, knowledgeable bankruptcy attorney to help you through the process of proving that you meet the requirements noted in the bankruptcy code. There may also be a conversion fee. Some debts you are accepting as part of your bankruptcy case could impact your eligibility, and the overall outcome of the means test could impact your bankruptcy case outside of the conversion.
Preparing the Conversion Documents
Proper preparation of the various conversion documents is critical as you venture into switching your bankruptcy from Chapter 13 to Chapter 7. Your financial situation is critical, as presented in your bankruptcy petition.
Any change in your financial situation since you originally filed your Chapter 13 will need to be identified, such as secured debts, car loans, other secured debt, and property division debt. All of this work, however, will be done with the guidance of your bankruptcy attorney to ensure that all information is properly presented to the bankruptcy court.
Filing for Chapter 7 Conversion
The conversion of Chapter 7 is a crucial point during the bankruptcy in Chapter 13. You are filing your fresh bankruptcy appeal in the court for bankruptcy, converting a Chapter 13 to 7, and you are requesting it now. Reaching this phase implies that your personal and financial environment is essential to the two differences regarding bankruptcy.
However, it is strongly suggested that you gather a specialist local bankruptcy attorney or solicitor to go through the complexities regarding putting a case to the court that requires Chapter 7 of bankruptcy. Keep to the message simpler than you can through Chapter 7 bankruptcy.
Meeting with the Trustee
Meeting with the trustee is one of the most important aspects of Chapter 7 bankruptcy conversion. The trustee is assigned to your case to manage it and ensure that it conforms to all the rules of bankruptcy. This is an opportunity to discuss the many aspects of converting your case to bankruptcy within the courtroom with the trustee.
Your repayment plan, post-petition debt, and any plans (if you have any) to reimburse your debt to your creditors are just a few of the things that will be discussed during this meeting. The reasons why you qualify for Chapter 7 bankruptcy conversion, as evaluated under the means test, is another common talking point during creditors’ meetings.
You will want to be well-prepared before heading into this meeting: you are required to be present, and you will want the guidance of an experienced bankruptcy attorney beside you for the trustee’s questioning. You don’t want to be caught off guard.