I can't seem to find anything on converting a 13 to an 11 because claims go over the allowed limit for a 13. I filed a 13 in February and it looks like it is going to be dismissed by the end of the week. My lawyer says I can't do an 11--it's too expensive. All I know is that I am literally paralyzed with fear as to what comes next. The bulk of my debts are student loans--almost 20 years of going to school, then putting them in deferment, then going back to school, then deferments, then . . . . Nothing was past due when I began the bankruptcy process and I know that now I will be handed back a mess, since my credit accounts went to collection agencies. Help, please. I can't have the calls and garnishment at work--I'm a teacher and my thoughts of what is in store for me without the protection of the court is beyond words . . . .
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What happened? Can you modify?Discharge date: October 2017 (will it ever get here?)
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I know my lawyer re-worked something on the plan in April after the 341. My student loans are outside of the plan, and have been paid every month since January. And I know that my lawyer responded to the motion to dismiss with a motion to deny the motion??? Anyways, that is what is happening in a couple of days-I'm on the docket for the motion to dismiss the motion. Should I start protecting my bank account--I get paid next week and don't want it seized . . . but really thought I could go an 11. At the filing signing, my lawyer saw that the numbers were high and tried to address it, saying even then that I didn't want to do an 11. I really don't know where to turn or what to do . . . .Comment
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If you are over the 13 debt limits you simply cannot remain in a 13 - period. If the student loans put you over the debt limits I have real concerns. The student loans are not discharged in any bk unless you get a finding of hardship. The fact that they will survive the bk does not change the fact that the amount of the loans are calculated for debt limit purposes. So. . . why, all of a sudden, is there a question that you are over the debt limits?
The question becomes, why did you file a 13? What were you trying to accomplish? Can you accomplish the same thing in a Chapter 11? What about a Chapter 7? Is there a reason you did not do a Chapter 7? Too much income maybe? To many non-exempt assets? How about trying to save a home? There had to be a reason you were "reorganizing".
If you really need a reorganization bk you need to find an attny who handles 11s. They are not necessarily too expensive if you find an attny who knows what he/she is doing. Ask your current attny how many 11s he has filed. My gut tells me not very many if at all.
And. . . What state are you in. (I really wish posters would at least tell us what State we are dealing with)
Des.Comment
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I am in Missouri. I needed to reorganize because of the student loans coming due and I couldn't afford the payment--even at the income based payment--with my credit card bills, car, etc. I couldn't go a 7 because I earn too much. I just want to pay my creditors, my student loans, and continue with life. I can retire in 5-6 years and needed to have the creditors paid off so I could continue to be able to make the student loan payment. I'm not asking for a hardship on them--doubt I would get it anyways-I just want the protection of the court while I take care of my bills over that five year period.
Is it possible to re-file an 11 as soon as the 13 is dismissed? Like in a month? How fast do creditors react to a dismissed bk?
Thank you. I have NEVER felt this much stress and fear of the unknown before . . . .Comment
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Are these student loans currently in deferment? If so, I can see an argument that they are not currently due therefore they are not creditors in the Chapter 13. I've never tested that theory but I can see the argument.
Assuming the student loans are included in the debt limit calculation, here's the deal. . . if you are over the debt limits a Chapter 11 may be the way to go. You are not limited to 60 months. You can set your Plan length as far out as you would like (within reason) and provide payment of as much as you can (the more the better) to all unsecured creditors. If you are not paying 100%, the student loan creditors would not be able to seek payment of the remaining balance until you complete your Plan and obtain your discharge. That could be years down the road.
I do not know if a Chapter 11 is justified for your situation but it is something you should explore. A good 11 attny will ask you the right questions to see if you have an "impaired class" that will vote in favor of the Plan (very technical). Chapter 11s do require a lot of work on your end because you act as the Trustee. You will file monthly reports. You will make the disbursements to creditors once the Plan is approved. You will pay quarterly fees to your boss, the US Trustee. But. . . the handling of the 11 is not impossible. A good portion of my Firm's practice is the filing of "consumer" Chapter 11 cases so I know it can be done, and done successfully.
Ask your current attny for a referral. You should explore the avenue even if it is just to get a bit more educated.
As to your creditors, my guess is that 30 to 60 days after the dismissal you will be back in "collection" mode with them. However, for the moment you should not be stressing. You have options. You just need to explore them and keep a level head while doing so.
Des.Comment
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Thanks, Des--
My student loans were in deferment, but I used all the deferment time, so entered the income-sensitive repayment plan right before I filed the 13. Thank you SO MUCH for your assistance--it sure is calming me down. I couldn't see any options, and to know that I have some is heartening. The 11 does sound like a bit of work, but I have no problem with keeping on top of something as important as this to get through the darkness of the tunnel I am in.
Why does the court allow an individual to act as Trustee in an 11 and not in a 13? Would my attny help me with these monthly reports?
And if for some reason an 11 doesn't work out--well, since I can't do a 7 or a 13--any advice for options then?
Thank you!Comment
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Originally posted by bjhkmf View Post
Just the way Congress wrote the law. Chapter 11 is typically for corporations but individuals can also file. The debtor is called a "debtor-in-possession" and holds all of the rights and duties of a Trustee. In a Chapter 13, the law provides for the appointment of a trustee despite the fact that a debtor remains in possession of all property
Depends upon the attny. Typically we assist in reviewing how to fill out the first couple of reports. Then it becomes routine and the client does not need our input.Originally posted by bjhkmf View Post
Not really since I do not know your particular situation.Originally posted by bjhkmf View Post
Des.
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Wow. Thank you for taking the time to explain things to me. I have gone from waking up again at 3:00 a.m. with a sense of dread to feeling a bit of focused calm. I will see what happens in court on Thursday, but I'm not expecting much in my favor, and then will begin my education of Chapter 11--the consumer variety. It seems only two of the area's attorneys advertise they will do a Chapter 11, so I am hoping that one of them has the background for an individual 11 and can take me through the mess that is left over.
How soon is a dismissed 13 closed? Is that when I am "free" to pursue the Chapter 11?Comment
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I am by no means any kind of expert on ch. 13 anything. I can only say what we did in my plan and my numbers are all pretty large. I actually just looked up debt limits and I'm kind of shocked that I didn't get caught up with this limit thing. Anyway, I have $160,000 in student loans, $170,000 in tax debt, $90K in credit debt, $10,000 in secured, (foreclosed/deed in lieu houses not included). We deferred my Student Loans until discharge, discharged the debt and paid the taxes in the plan and the car in the plan........ Can you defer your loans? and pay the credit debt in the plan? my payments were pretty big...now I should be discharged and waiting to start paying my student loans.Comment
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Closing of the 13 varies from jurisdiction to jurisdiction. Trustee has to do his final accounting. However, you should be free to file the 11 (if that is the correct course of action) once the dismissal is entered by the Clerk of the Court - basically when the judge signs the Order dismissing.Originally posted by bjhkmf View Post
Des.
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