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WALLSTREETESQ
WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 16420
Experience:  14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
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I recently had my Chapter 13 converted to a chapter 7 due to

Customer Question

I recently had my Chapter 13 converted to a chapter 7 due to an error made by my lawyers paralegal in calculating the means test (I was in 13 for about six months).

While under the 13 I did the following which the new Chapter 7 Trustee will see:

I took out and repaid several payday loans to make ends meet. I did not request Chapter 13 Trustee permission.

I took out two 403B loans (one for $2800 and one for $1040). Both in preparation for a likely breakdown of a car with 200k miles and the likely need for high deposit money when I leave my home. Again I did not inform the trustee.

Questions

Does the fact I used pay day loans and borrowed from my retirement without trustee approval doom the likely success of a chapter 7 or can I press ahead?

Do the dollar amounts borrowed from my 403B impact the chapter 7 means test in a way which would cause failure and ineligibility?

If one or more of these issues is too great a problem to overcome - can I simply refile in say 8 months?
Submitted: 1 year ago.
Category: Bankruptcy Law
Expert:  WALLSTREETESQ replied 1 year ago.

WALLSTREETESQ :

Hello I am a licensed attorney here to help you with your question, please review my response and do not hesitate to ask for clarificati on

WALLSTREETESQ :

The pay day loans are an issue, as they happened during the bankruptcy, and you would not be able to discharge them,

WALLSTREETESQ :

also taking out money from your retirement is not smart, and can be part of the means test,

WALLSTREETESQ :

as they look at the last 6 month income,

WALLSTREETESQ :

In a case such as this, I would consider having the case dismissed, and refile at a late time, as you could also face issues with the trustee for doing this while a chapter 13 is pending.

Customer:

That is the answer I expect my lawyer to give me. Are dismissals granted pretty automatically?

WALLSTREETESQ :

No,

WALLSTREETESQ :

if it were still in a chapter 13, it would be easier,

WALLSTREETESQ :

if it was converted to a chapter 7, you can file a motion, or not appear at the 341 hearing and see if the trustee will dismiss it on his own,

Customer:

Cool Thanks

WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 16420
Experience: 14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
WALLSTREETESQ and other Bankruptcy Law Specialists are ready to help you

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WALLSTREETESQ
WALLSTREETESQ
Attorney
2749 Satisfied Customers
14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS