Many times when an individual files for bankruptcy it ends up that they qualify for a Chapter 13 bankruptcy. This is also a good form of debt relief. Rather than having all or most of the debts discharged, it allows for a debt repayment plan. It entails comprising a plan for paying the debts owed and the payments are monitored by the bankruptcy trustee.
Changing Chapters
On occasion the chapter 13 bankruptcy requirements are not able to be met and the individual needs to switch over to a Chapter 7. This is no easy task, and it is really important that individuals in this situation seek out the services of a New Albany bankruptcy attorney.
The transition over from one bankruptcy to another can be complex. There have been some recent court rulings concerning this that have made it more beneficial for the individual going bankrupt. In this particular case there were issues over the funds the Trustee had on the plan date of the conversion. The courts rules that the funds available on the date of conversion belong to the individual going bankrupt.
There was some dissention amongst the courts over the funds available on the date of conversion. Some courts believed the money should go back to the debtor. Other courts believed the Chapter 13 Bankruptcy Trustee should use the money. In a final ruling by the U.S. Supreme court it was held that the money should go back to the debtor.
Every bankruptcy case is different and what applies to one individual may not be the same for another. It all depends on the specific circumstances.
