Can I switch to a Chapter 7 bankruptcy after filing for Chapter 13?

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Written by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

UPDATED: Jul 16, 2021

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Yes, you can convert a Chapter 13 case to Chapter 7 bankruptcy at any time, for any reason, as long as you qualify for a Chapter 7 bankruptcy. You cannot avoid the qualifications for filing a Chapter 7 simply by converting a Chapter 13. You still need to meet the means testing requirements or the Court will refuse to convert the case.

The typical reason for converting is that you cannot meet the obligations of your payment plan due to changed circumstances. You should be aware that in doing so you will lose some of your property. Any property you own at the date of the conversion belongs to your Chapter 7 estate; unless that property is exempt, the trustee will be able to take it and sell it for the benefit of your creditors.  In essence, the conversion resets the clock. If you have property that was exempt when you filed the Chapter 13 petition, it may have changed to non-exempt property by the time you convert, thereby putting that property at risk.

Furthermore, if you received a discharge in a Chapter 7 case filed within the six years preceding the filing date of the chapter 13 petition, you cannot receive a discharge in the converted case. There would not be much point in converting in that situation. 

Depending on your situation, you may want to simply dismiss and re-file as a Chapter 7. Consult with a bankruptcy attorney before converting or dismissing to determine which will work best for your financial situation.

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