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Filing Chapter 13 After Chapter 7

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  • 02-18-2011, 08:38 PM
    mdrn
    Filing Chapter 13 After Chapter 7
    My question involves bankruptcy in the state of: Md.
    how long after a ch. 7 bancrupcy is discharged would I have to wait before filing a ch. 13 for other debt- like mortgage debt?
  • 02-18-2011, 11:19 PM
    Betty3
    Re: Filing Chapter 13 After Chapter 7
    If you filed a Chapter 7 and received a discharge, you must wait four years before you can file a Chapter 13 and be eligible for a discharge.
  • 02-19-2011, 04:11 AM
    despritfreya
    Re: Filing Chapter 13 After Chapter 7
    It sounds like you want to do a Chapter 20 (7+13) to save your home (cure the arrears) and are not expecting to obtain a discharge in the Chapter 13. If that is the case you can file the Chapter 13 the moment you receive your Chapter 7 discharge. If that is not the case you must wait 4 years from the date of the Chapter 7 discharge to be eligible to obtain a Chapter 13 Discharge.

    Des.
  • 02-20-2011, 01:13 AM
    Betty3
    Re: Filing Chapter 13 After Chapter 7
    OP, here is a link on a Chapter 20 bankruptcy if you might like to read it.

    http://thismatter.com/money/credit/b...chapter-20.htm
  • 03-17-2011, 04:17 PM
    cobb44
    Re: Filing Chapter 13 After Chapter 7
    owe back taxes RI state 19,000 and federal 36,000, RI has lien on my home IRS no, tried OIC but dismissed due to being in bankruptcy House underwater no equity Can I request a motion to determine the value of the lien RI and since the irs debt is secured whether lien filed or not can I get the tax debt for RI and IRS dismissed due to no value and can you file a motion without re opening the case or do you have to reopen and can we go from a chapter 7 to 13 to get rid of the 2nd mortgage, the taxes do not meet the three year rule
  • 03-19-2011, 07:24 AM
    despritfreya
    Re: Filing Chapter 13 After Chapter 7
    Quote:

    Quoting cobb44
    View Post
    owe back taxes RI state 19,000 and federal 36,000, RI has lien on my home IRS no, tried OIC but dismissed due to being in bankruptcy House underwater no equity Can I request a motion to determine the value of the lien RI and since the irs debt is secured whether lien filed or not can I get the tax debt for RI and IRS dismissed due to no value and can you file a motion without re opening the case or do you have to reopen and can we go from a chapter 7 to 13 to get rid of the 2nd mortgage, the taxes do not meet the three year rule

    1. A section 506 issue (value/extent of lien or interest in property) is not an issue for a Chapter 7 as liens pass through a Chapter 7 Discharge unaffected. This is true for the tax liens and/or the 2nd mortgage.

    2. You can attempt to reopen your 7, ask that the discharge be revoked and then convert to a 13 but such is not practical.

    a. If you were above the debt limits for a Chapter 13 when you initially filed the 7, you simply do not qualify for a 13.
    b. If your jurisdiction requires the revocation of the 7 discharge before converting, you lose the discharge as it relates to all other creditors. This may, or may not, open a can of worms.
    c. Depending upon when you filed the 7, it may simply be too late to try.

    3. Filing the 13 now, instead of trying to reopen the 7, will allow you to pay the taxes over 5 years. Since all are within the last 3 years the claim filed by the taxing agencies will be broken down into at least two sections. My experience is that the claim's secured portion (lien rights) will pretty much match the value of the assets listed on Schedule A and B, after consideration for any consensual liens (mortgage, auto loans for example). The priority unsecured portion of the claim will be the balance owed less any penalties. You will be required to provide for interest on the secured portion. Since you have already received a Discharge in the 7 and, therefore, are not entitled to a Discharge in a 13, interest may run on the priority portion, but, honestly, I am not sure. The State and Federal agencies may fight over which one is entitled to a secured status but, typically, whichever one filed the lien first gets first dibs at such status. You, however, do not care, as the only amount that will be paid as secured will not change.

    4. As it relates to the strip off of the 2nd mortgage, the vast majority of court opinions hold that once you have received a discharge in a 7 you cannot, on the heals of that 7, file a 13 to strip off the 2nd. The courts reason that since the strip off does not become effective until you recieve a 13 discharge, one cannot do a strip off if one is not entitled to a discharge. While I completely disagree with that reasoning, it is a majority rule. Just yesterday a California court said it was ok, but there are three other cases out of the same jurisdiction that say it is not ok.

    You really need to sit down with a very qualified bk attny in your jurisdiction. Please do not try this on your own.

    Best regards.

    Des.
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