We filed a chap 13 in April of 07. We had a previous chap 7 due to predatory lending in Oct. 03. We are not eligible for a discharge due to attorney did not catch that it had not been 4 years since the 7 until we were already sitting in court. I lost my full time job in Oct. 07, shortly after filing. I was unemployed for 2 years, yet we struggled and have paid on the 13 for 3 years now. I now work from home, but for half the pay and half of the hours that our payment were set up on. It is just impossible for us to continue with this, when in the end its not doing any good without the discharge. Would we be eligible for a partial or hardship discharge,due to me losing my job and reduced income by over half? Would we have to dismiss and re-file, since were not eligible for anything now?
Chapter 13 Bankruptcy Attorney
I am unaware of any provision in the bankruptcy code that allows for a "partial" discharge under chapter 13. However, you could speak with your attorney about allowing your current chapter 13 case going to a dismissal and then re-filing. You would be beyond the four years so that you could get a discharge of your debts in a chapter 13. You may run into some issues with regards to extending the automatic stay in the new filing and it costs you more money but, as you indicated, your current filing may be doing little for you without the prospect of the debts being discharged.
Section 1328(b) provides for what is known as the hardship discharge in chapter 13. In your case, changes may enable you to get this early discharge after confirmation of the plan and after notice and a hearing, the court finds that your failure to complete the plan is due to circumstances for which you should not be held accountable (e.g., involuntary job loss), unsecured creditors already received what they would have received in a Chapter 7 case, and modification is not possible or practical.
It sounds like you may be eligible. Make sure that you have completed all requirements, like taking the financial management course.
If you do not already have an attorney, find one now. You will want counsel to do this. Good Luck.