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Is it possible to redo my Chapter 13 due to my lay off and my husband' hours being cut?

Asked over 2 years ago - Chicago, IL

Bankruptcy Chapter 13 Bankruptcy Spousal Debt

In 2008 my husband and I applied for a Chapter 7. At that time we both were working and we were told by our attorney that we made too much money for a Chapter 7 but we could apply for a Chapter 13. We did but now in May, '09 I was laid off from my full time job and my husband's hours were cut with his job. Is there anyway that I may be able to revise this Chapter 13 to a Chapter 7?

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Attorney answers (2)

Kevin Kennedy Gipson

Reputation Level 10

Answered over 2 years ago. Chapter 13 Bankruptcy Attorney in New Orleans, LA.

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Whether or not you can modify your Chapter 13 Bankruptcy Plan to allow you to continue in the Chapter 13 will depend upon the following factors:

1) Will you still have enough money to fund the Chapter 13 Plan? Just as when you originally filed your Chapter 13 bankruptcy, your Plan must be feasible, meaning that you have enough money to pay your monthly bills and still have money left over to to make your Plan payments.
2) Does your current plan use the entire 60 months that are available for a Chapter 13 Plan? If there are still some months left available to you, then depending upon the amount of income available you might be able to extend the Plan length and pay a smaller monthly payment.

If either of the above situations do not apply, then it is unlikely that you will be able to continue in the Chapter 13 bankruptcy.

However, from your question it appears that you would have preferred to have been in a Chapter 7 bankruptcy anyway.

Based upon your circumstances it would appear that you should be able to convert your Chapter 13 bankruptcy to a Chapter 7 bankruptcy.

You need to discuss your various options with your attorney because procedures vary from court to court.

Law Offices of Kevin K. Gipson

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Henry Repay

Reputation Level 15

Answered over 2 years ago. General Practice Lawyer in Belvidere, IL.

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Your question is complicated and cannot be answered without a detailed examination. It may be possible to convert your case from Chapter 13 to Chapter 7, but that depends at a minimum on a review of your income and the circumstances with respect to certain creditors. Otherwise, you may be able to obtain a modification of your plan in the form of reduced payments or a short-term suspension if the plan can be so modified and remain feasible.

The scope of this space does not afford an opportunity to assess the situation and advise you. I recommend you assemble for legal consultation: (1) your income information for February through August, including wages and unemployment during that period; (2) a copy of your petition, plan and related bankruptcy documentation; (3) last two years' tax returns; (4) an updated credit report (annualcreditreport.com to obtain free report if not requested in last year); and (5) other information that may apply, such as copies of lawsuits. Set up an appointment at your earliest convenience to afford the most opportunity in which to be advised about your best course.

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