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Converting a Chapter 13 bankruptcy into a Chapter 7

When considering filing for a personal bankruptcy in Manchester, you may be left to choose between a Chapter 7 bankruptcy (in which many of your debts may be dismissed), or a Chapter 13 (in which you pay back a portion of them). Here at The Law Office of Paul Petrillo, we’re often asked which of the two is the most advantageous. The truth is that depends largely on your situation.

Data shared by the American Bankruptcy Institute shows that of the over 819,000 bankruptcies filed in 2015, 519,130 were filed under Chapter 7, while 299,515 were Chapter 13 cases. This is not to say that one form is better than the other. In fact, you may go into your case wanting to file for a Chapter 13 in order to have the chance to repay some of your creditors. However, circumstances could force you into converting into a Chapter 7 case. Scenarios where this could happen may include:

  •          Your failing to meet Chapter 13 filing requirements on time.
  •          Your decision to rethink retaining ownership of certain properties and assets.
  •          Your inability to meet your Chapter 13 repayment schedule due to a change in your financial circumstances.

If you pass the bankruptcy means tests (an examination of your ability to repay your creditors), then the court may approve converting your case to a Chapter 7. Your conversion date is often considered to be your new filing date. Your petition and schedules may carry over, yet you will have to file a new Statement of Intention and have another meeting of creditors. The court may also choose to change your exemptions to those allowed as of your conversion date, not your original filing date.

More information on handling a personal bankruptcy can be found here on our site. 

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Law Office of Paul Petrillo
One Tara Boulevard
Suite 200
Nashua, NH 03062

Phone: 603-635-4149
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