Yo Yo-Will I be allowed to convert back?

[slickwilly95991]

We started with a Chapter 7, but the Trustee said we made too much money. They were going to dismiss unless we converted to a 13. We have been in a 13 for about 6 months.

I lost my job two months ago and I haven't found employment yet, prospects are not looking good. If our Means Test income drops below the average, will we be able to convert back to Ch. 7 if we already were there?

[HHM]

You should be able to "convert" back to a chapter 7. What you are prohibited from doing is having a "voluntary" dismissal of your chapter 13 because your chapter 13 is a conversion from a 7.

I am not sure if the provisions about the automatic termination of the automatic stay (30 days) kicks in on a conversion like this. When a case is dismissed and the debtor refiles, the debtor must demonstrate to the court that the re-filing is not an abuse. If the debtor cannot do so, the automatic stay terminates after 30 days. That may apply in you case, but I am not sure.

[papa0881]

what does automatic stay mean exactly? creditors cannot do anything for 30 days if it is dismissed?

[HHM]

When you file BK, what is known as the "automatic stay" kicks in. What that means is that no credit can take any action, whatsoever, to collect a debt against you (i.e. no lawsuits, garnishments, phone calls, etc). The automatic stay continues in effect from the date you file until the date your case is either discharged or dismissed.

Under the new law, if a debtors case is dismissed, and the debtor "refiles" the case within 180 days of that dismissal, the debtor only gets the benefit of the automatic stay for 30 days from the date the debtor refiled their case.