I was denied a mortgage re modification by my bank also
A Debtors' right to convert from one chapter of bankruptcy to another is automatic and the first conversion will be automatically granted. When you convert you will need to file an amended budget (schedules I and J), new Statement of Intention, and any other supporting docs. You will need your budget to support a conversion from a Chapter 13 to Chapter 7. Have you had a loss or change of income that does so? If your budget supports the conversion there should be no objections.
Another important question for you is - what is your intention with your house? Do you want to keep it? From what you wrote above my sense is that you are behind in your mortgage payments: Did you file a 13 to save your home and now have also been denied a modification? If your goal is to save your home and you are in arrears, you would not be able to keep your home in a Chapter 7 unless you became current with your mortgage payments and continue making the payments on time.
This is definitely something that you want to speak with an attorney about.
Hopefully you have an attorney. If you do not have one in this situation you need one YESTERDAY.
You may or may not be eligible to convert depending on many things including income. And it may or may not be wise to convert depending on numbers. Along with conversion, you need to someone who can advise on staying in the 13 (and perhaps modifying it) and dismissal, which also may be options. Note that lifting a stay doesn't guarantee foreclosure; it simply allows it. These are all questions that a lawyer can answer only with all the numbers and facts.
If you don't have counsel and need counsel, feel free to call me at 404-768-3509.
In order to convert your Chapter 13 to a Chapter 7, you must first qualify for a Chapter 7. Do you meet the income requirements for a Chapter 7? Have you ever filed a Chapter 7 bankruptcy case? If so, has 8 years passed?
You should not only consider whether or not you qualify for a Chapter 7, but also consider whether converting to a Chapter 7 is in your best interest. What are the reasons that you initially filed Chapter 13? Was it just to save the property on which the "stay" was recently lifted, or did you specifically file Chapter 13 for other reasons as well? What else, if anything, are you paying for for through your Chapter 13 Plan? Are you paying for a vehicle and/or tax debt through the Plan? What other assets do you have and can they be completely exempted?
There is A LOT to consider when trying to determine whether or not you can, or even should, convert to a Chapter 7. If you are represented by an attorney, I strongly suggest that you speak with your attorney about this issue. If you are not represented by an attorney, I believe that it is in your best interest to meet with an attorney and seek legal advice about this issue. Without knowing all the facts of your case, the answer to your question is not a simple "yes" or "no". Good luck to you.
Recent cases from the Eleventh Circuit (federal appeals court) have found Fair Debt Collection Practices Act violations by foreclosing attorneys. Also Foreclosure notices are under more scrutiny. The foreclosure actions taken at the time you filed bankruptcy may give you FDCPA claims against your lender and the foreclosing attorneys which can either be pursued for money damages or may be pursued for current leverage. If you are represented by an attorney, have the attorney call an FDCPA attorney in Atlanta of which my firm is one.
If you are in a Chapter 13 most likely you have an attorney currently representing you in that matter. You really need to call your attorney's office, schedule an appointment to go in and sit down with the attorney to discuss your best course of action. The answer to your question is going to be determined by the result you would like to achieve.
The attorneys before me made some good points. The major issue here is whether or not you qualify for Chapter 7, even though you probably would not have passed the "means" test (Form 22A in under Chapter 7) had you initially filed for Chapter 7.
Some bankruptcy courts have ruled that you must take the means test, while others have ruled that you don't need to worry about it as long as the Chapter 13 plan was filed in good faith (i.e. feasible plan based on your income). To be on the safe side, you should file the Form 22A under Chapter 7 and analyze (something an attorney will be able to help you do) what exactly has changed as far as income and expenses.
For example, if one files under 13 and converts to a 7 because he/she got laid off, they would most likely be in the clear. In contrast, if one files under 13 and converts for no apparent reason to a 7 after a week, the means test will likely have to be addressed. Further, there are certain tools an attorney would be suited to handle if you have equity in your home, as they relate to Chapter 7 exemptions. I definitely recommend retaining counsel if you have not already.
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