Canceling Your Bankruptcy

For some individuals, filing for bankruptcy appears to be the best option for getting rid of overwhelming debt. However, once you begin the bankruptcy process, it’s easy to become overwhelmed and want to get out of bankruptcy.

This situation is common when individuals file their own bankruptcy cases without an attorney’s assistance and then want to stop bankruptcy proceedings. Unfortunately, you may not always be entitled to a voluntary dismissal of your bankruptcy case. It’s best to get a qualified bankruptcy attorney to help you understand your unique situation. They are always the best help when you need to know how to get out of bankruptcy.

How to Request for Voluntary Dismissal of Chapter 13

A Chapter 13 bankruptcy case is referred to as a “wage earner’s plan” because you make payments to a Chapter 13 trustee each month. The Chapter 13 trustee pays your debts according to the terms of your bankruptcy plan. You must have sufficient income to fund a repayment plan for approval to file under this chapter of bankruptcy.

In most instances, debtors can request a voluntary dismissal of Chapter 13 cases because a reorganization is voluntary. The courts do not force debtors to reorganize their debts through a bankruptcy plan. However, you need to consider the consequences of your decision to dismiss a Chapter 13 bankruptcy case.

The issues and problems you faced before filing for bankruptcy relief have not gone away. Creditors can resume foreclosures, repossessions, lawsuits, and collection efforts the minute the court grants the bankruptcy dismissal. If you decide you need to be protected under Chapter 13, refiling bankruptcy may not be as easy the second time.

Refiling a Chapter 13 case after a voluntary dismissal may not immediately protect you from the actions of creditors. The Bankruptcy Code imposes certain restrictions and waiting periods for some debtors who refile Chapter 13 after a voluntary dismissal, and certain debtors may even be barred from refiling a bankruptcy for a certain period of time (which can be problematic in a foreclosure or repossession situation).

Therefore, before you consider how to get out of Chapter 13 bankruptcy, you should consult with a Dallas bankruptcy lawyer to discuss your options. You may amend your Chapter 13 plan to make it more affordable, thereby allowing you to remain under bankruptcy protection while getting out of debt.

How to Get a Chapter 7 Bankruptcy Dismissed

Filing a motion to dismiss Chapter 7 bankruptcy proceedings is not as simple as requesting a Chapter 13 dismissal. You are not automatically entitled to a voluntary dismissal of Chapter 7. The bankruptcy court reviews several issues to determine if the dismissal prejudices any parties, including your creditors, before it grants a Chapter 7 dismissal.

In most cases, if you are seeking a Chapter 7 bankruptcy dismissal to avoid losing nonexempt property, the Chapter 7 trustee will object to your motion to dismiss. The trustee is acting in the best interest of your unsecured creditors. Denying the dismissal allows the trustee to liquidate assets to pay your unsecured debts. If you are allowed to dismiss your case, your creditors are likely to receive nothing.

Therefore, the court will probably deny your motion to dismiss without a compelling reason why you should be allowed to a voluntary bankruptcy dismissal of your case.

In some cases, your Chapter 7 case can be dismissed because you failed to file the remaining bankruptcy schedules and statements required by the Bankruptcy Code. You may also have a case dismissed for failing to complete the credit counseling course or appearing at the 341 Meeting of Creditors.

However, if the Chapter 7 trustee believes you may be purposefully trying to have your case dismissed, he may file a motion with the Bankruptcy Court to prevent an automatic dismissal to pursue nonexempt assets.

Bankruptcy Dismiss vs. Bankruptcy Conversion

Before you attempt to dismiss your Chapter 7 bankruptcy case, you should discuss converting your case under Chapter 7 to a case under Chapter 13 with our Dallas-Fort Worth bankruptcy attorney.

Converting to a Chapter 13 case can prevent the trustee from seizing and liquidating nonexempt assets. In addition to protecting your property, you can still get rid of unsecured debts for pennies on the dollar through a Chapter 13 bankruptcy repayment plan.

In many cases, converting from Chapter 7 to Chapter 13 is a viable option when a Chapter 7 trustee is pursuing assets, or you make too much money to qualify for a Chapter 7 case. If you earn sufficient income to fund a bankruptcy plan and you are not attempting to convert the case to defraud the court or your creditors, most judges will grant a voluntary motion to convert from Chapter 7 to Chapter 13.

Converting or Dismissing a Bankruptcy Case in the Dallas-Fort Worth Area

Leinart Law Firm can help you if you filed a bankruptcy case on your own and you need to dismiss the case. Before you take any actions, we urge you to speak with a bankruptcy lawyer to learn about your bankruptcy options. You may have several options and choosing the right option for you could result in getting out of debt and moving forward after a financial crisis.

Contact our law firm by calling (469) 232-3328 or (817) 426-3328 to request a free bankruptcy consultation with a Texas bankruptcy lawyer.

Schedule a FREE, no-obligation consultation and evaluation today.