Can I Convert My Chapter 13 Bankruptcy to a Chapter 7?

Can you convert your Chapter 13 bankruptcy to a Chapter 7?Chapter 13 bankruptcy requires debtors to enter a three to five-year payment plan to pay back their debts. After completing the payment plan, you can keep your most important possessions and remaining unsecured debts are discharged. Depending on the circumstances, there may be benefits for converting your Chapter 13 bankruptcy to a Chapter 7 bankruptcy. People may do this for the following reasons.

  • Your financial circumstances change, such as losing a job. Perhaps you can no longer afford your Chapter 13 repayment plan for other reasons. This may happen if your household size increases and the added expenses make Chapter 13 payments too difficult. Unexpected illness may also make Chapter 13 payments unaffordable.
  • If you filed Chapter 13 to keep certain property and decide you no longer want that property, you may benefit by converting to Chapter 7.
  • In some cases, the bankruptcy court requires debtors to convert their cases to Chapter 7. Forced conversion can happen if you fail to make Chapter 13 payments on time (or at all). This is only one example.

There may be restrictions for converting your case, so it is important to discuss your situation with your attorney.

Are There Benefits for Converting Your Chapter 13 Bankruptcy to Chapter 7?

Depending on your specific financial situation, there may be benefits from converting your case. If Chapter 13 payments were too difficult or you no longer wish to keep certain properties, you may benefit from converting. Chapter 7 bankruptcy will not require payments and can discharge your unsecured debts.

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