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If We Convert from a Chapter 13 Bankruptcy to a Chapter 7 What Will Our Credit Report Show? – Cheryl

“Dear Steve,

we are having a hard time making our ch 13 payments and thinking a bout converting to ch7 from ch13 and wanting to keep our truck

We have a ch 7 bankruptsy we filed in 2003 and had to file ch13 in april o9 will we be able to convert to ch7 and keep our truck, my husband is working PT with the gas prices and food prices going up and other expenses it is getting harder to stay in the ch13 my ch7 will be off my crdit report in 2013 if i convert to ch7 will there be three bankruptsy on my report or will the ch13 change to ch7 thanks

Cheryl”

Dear Cheryl,

It is my understanding that the credit report should show the conversion date to the Chapter 7 bankruptcy and the eight year clock will start over again at that time.

You credit report would show the previous Chapter 7 and Chapter 13 and the new conversion to a Chapter 7.

If your husband is only working part time I have to ask, can you even afford to keep the gas guzzling vehicle at this time? I wonder if it is time t hand the truck back before you convert to a Chapter 7. This way you can get the fresh start you need while getting the maximum benefit from the upcoming Chapter 7 bankruptcy.

It seems the goal should be to utilize bankruptcy to get you the fresh start you need instead of just making this yet another year to struggle.

Please post your responses and follow-up messages to me on this in the comments section below.

How much is your Chapter 13 bankruptcy payment? If you were not paying that would you be able to get by?

Sincerly,
Steve

You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

READ  I'm Being Sued by a Creditor And Was Told Only Chapter 13 Bankruptcy Might Be Right For Me. - Tim



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Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

5 Comments

  • Cheryl – If your Chapter 7 was filed in 2003, it went off your record in 2011 (8 years from filing to filing). What is keeping you from filing Chapter 7 is that you filed Chapter 13 less than 4 years ago (hence the 2013 date). Make a motion to dismiss your Chapter 13 (showing cause, such as decreased income), then file a new Chapter 7. And stop going to non-lawyers for legal advice.

    • The credit bureaus say the chapter 7 will be reported for ten years from the date of the filing. Do you have some other source that says differently?

  • “The credit report should show the conversion date to the Chapter 7 bankruptcy and the eight year clock will start over again at that time.”
    This is an incorrect statement; the clock will not start over again. The 8 years runs from filing to filing, and conversion is not a filing. Therefore, the questioners cannot convert the Chapter 13 to a Chapter 7 because the time between filings is only ~6 years.

    Please refrain from giving legal advice unless you are a licensed attorney. Thank you.

    • Well maybe you can help clarify this issue for us. Bankruptcy Law Network says: “The new rule is that 8 years must pass between Chapter 7 bankruptcies.” – http://www.bankruptcylawnetwork.com/bankruptcy-basics-chapter-7-the-new-rule-is-8-years/

      “The court will deny a discharge in a later chapter 7 case if the debtor received a discharge under chapter 7 or chapter 11 in a case filed within eight years before the second petition is filed. The court will also deny a chapter 7 discharge if the debtor previously received a discharge in a chapter 12 or chapter 13 case filed within six years before the date of the filing of the second case unless (1) the debtor paid all “allowed unsecured” claims in the earlier case in full, or (2) the debtor made payments under the plan in the earlier case totaling at least 70 percent of the allowed unsecured claims and the debtor’s plan was proposed in good faith and the payments represented the debtor’s best effort. A debtor is ineligible for discharge under chapter 13 if he or she received a prior discharge in a chapter 7, 11, or 12 case filed four years before the current case or in a chapter 13 case filed two years before the current case.” – http://www.uscourts.gov/federalcourts/bankruptcy/BankruptcyBasics.aspx

      But you seem to be saying the eight year clock in this case is from the date of filing the chapter 13. Can you please clarify.

  • hey steve my payment is $300 but only $174 is going to the principal, i just got a letter that trustees  want to dismiss the case saying we are deliqunt  $3600 there is no way we can pay that and my husband is still working parttime he needs a vechile to getto work what should we do i cant convert to ch7 because my ch7 was in 2003 and i filed ch13 2009 the ch7 will be off my record in2013

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