converting from ch 13 to ch7--in 2010

[debtisbad4u]

I am just wondering if anyone has done this and what all is involved in this process. My attorney's office in Illinois tells me its going to cost around $500 to convert my ch13 to a ch7 in 2010. I just filed my ch13 last summer.

[HHM]

It is actually quite odd to have a set time to convert to a chapter 7.

What exactly is going to change in 2010 such that you have "changed circumstances" justifying conversion to a 7?

[debtisbad4u]

I would have filed a ch 7 again in 2008 but I have already file in 2002, so I have another 2 year wait before I can file 7 again, so we did a ch13 with the plan to convert to a ch7 in 2010. I live in Iowa. My atty said my large student loan debt is keeping me in bankrupcy...well no shiznit! and you can't include them--oh the irony!

[DebtEnder]

Whats the ratio of your student loan debt to your other debts?
With just the student loan debt and a modest home expense/living expenses could you pay down the student loan debt?

It's not impossible to discharge student loan debt, just very very uncommon. If you truly feel the student loan debt alone is enough to keep you underwater you should try to find an attorney that is willing to argue undue hardship in regards to that loan. Undue hardship is the most likely way to remove that debt.

However if you are in a $500K+ home with a $50k dollar car in your chapter 13 you may have issues proving your case. But if you got a cheap lil pos car and a small house/rent and still can't make ends meet well you might not be damned for all time

[HHM]

I would have filed a ch 7 again in 2008 but I have already file in 2002, so I have another 2 year wait before I can file 7 again, so we did a ch13 with the plan to convert to a ch7 in 2010. I live in Iowa. My atty said my large student loan debt is keeping me in bankrupcy...well no shiznit! and you can't include them--oh the irony!

I hate to burst your bubble...

But, I would be a little concerned. It is not as simple as "just converting" when the 8 year statute of limitation expires in 2010 to file a chapter 7. In order to convert, you must show "changed circumstances" from when you filed a chapter 13. Simply being able to qualify for a chapter 7 in 2010 is not enough if you were able so support a chapter 13; something has to actually change.

The other option would be to dismiss your chapter 13 and refile as a chapter 7, but you would need to wait 6 months from the time you dismissed your chapter 13.

[MackMan]

If you dismiss a chapter 13 and refile for Chapter 7 in six months, how do the creditors respond. Do they start the calling back up or do they proceed with court action?

[HHM]

If you dismiss a chapter 13 and refile for Chapter 7 in six months, how do the creditors respond. Do they start the calling back up or do they proceed with court action?

They can!

[debtisbad4u]

I drive a car that is 10 years old, no payment but a lot of repairs. I make 30,000 a year, single no dependents. I own my home, mortgage is 600/month. I work 3 jobs! yes, I said 3 jobs! I don't think any lawyer wants to help anyone get out of sl debt, the government wants their money and they dont care if you are homeless or penniless, you WILL pay them their money back! At least Obama is trying to change legislation in that area unlike presidents of the past. www.ibrinfo.org has a lot of information on this. My attorney assures me converting to a ch7 from a ch13 is "not a big deal" he told me himself that "your student load debt is keeping you in bankrupcy". But he won't fight for me in court to find my situation a "hardship" he siad that is too hard to do. I would have to be disabled, have 5 kids to support etc.... my only hope--the powerball!

[BKDefender]

debtisbad4u,
To get rid of your student loans you'll have to shoot yourself in the head and get brain damage or cut both of your arms off, or die. It's not that an attorney won't help you get out of student loan debt, it's that most people cannot afford the legal fees it will take to pay the attorney to try to get you out of student loan debt. The student loan lender will fight to the ends of the Earth to keep even one loan from being discharged to avoid starting an avalanche of people repeating a successful discharge of student loans. If you had $10k-$15k to pay your attorney, I'm sure he'd gladly take on your fight. But because you are able to work 3 jobs and can make all your payments, even if it leaves you with nothing left, you're not a hardship according to the courts.

This might sound odd - but can you get a 2nd mortgage on your home and pay off your student loans? You can discharge mortgage liability but not student loan liability, so you should do what you can to convert student loans to dischargeable debt then file bankruptcy to get rid of it.

--William

[debtisbad4u]

I started reading your post and thought "how harsh" but then thought "dont kill the messenger" its true! you have to be about dead or dead to get rid of this debt. Back when I chose to go to college I thought it was going to make life so much easier, if I had known the trouble it would have caused I would not have gone at all! or found an employer to pay for it.
I majored in social work, so no money in that!
the mortgage thing is something I have considered. I owe around 60 on my house and the last time I had it appraised was 04 or 06 cant remember, and it appraised at 92. So I guess I have around 30 equity in my house. I owe 42 in student loans. so even if I cash out equity I will still owe in sl??? do mortgage companies let you get "upside down" in mortgages these days?
thanks!

[BKDefender]

If you have excellent credit you can often go up to 105% on your mortgage with a home equity line of credit (HELOC). Don't assume that it's still worth $92k because in some areas 2006 was the peak of the market. A house two doors down from me sold for $255k in 2006, the defaulted on it in 2008, and it sold at auction for $110k six months ago. The one across the street sold for $190k in 2005 and just sold at auction this past November for $79k. Of course Vegas housing prices were skewed by all the 'more money than sense' investors from Southern California and buyers around here who didn't think twice about buying a $250k home on a 5/1 ARM paying interest only the first 5 years when they were making $50k/year because, of course, the house would increase in value, they could sell it to someone who could actually afford it, and voila - profit.

--William