Legal Question in Bankruptcy in Kentucky
bankruptcy conversion; chap 13 to chap 7
my wife and i filed for chapter 13 bankruptcy in july 1996. we are divorcing; we have a three year-old son and do not own a home. 95% of the bankruptcy debt is in my name and was obtained prior to our marriage. per the marital settlement agreement i will have to pay the trustee and of course child support. financially, a huge burden. i want to convert to chapter 7. will this help reduce my monthly payment to the trustee? if i do can we keep both cars and liquidate all other propeties that where listed with the trustee? i have a bankruptcy attorney who informed me in july 1996 that i could convert to chapter 7 if i needed. i'm awaiting his call; therefore, i decided to ask you.
1 Answer from Attorneys
523(a)(15) liabilities
You can convert from 13 to 7 without a doubt. HOWEVER without examining your divorce judgment, it is impossible to advise you fully - if you agreed to pay the debt, a bankruptcy court could determine under the above code section that your obligation under your divorce is not discharged - and you have to pay the debts in accordance with your divorce - this is a relatively new area - not many appellate cases - each fact situation has to be examined separately - but make sure your local attorney considers 523 when he advises you.
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