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We recently saw a situation where the debtor opted to file under Chapter 13 because of a problem qualifying for a Chapter 7 discharge.  That problem was that the debtor’s income exceeded $130,000 per year.

After the Chapter 13 Plan was confirmed, the debtor lost his job.  His attorney amended the plan to reduce the payments for a six-month period, hoping that the debtor would secure similar employment during that time.

Unfortunately, the employment did not materialize and the debtor had no job prospects when his plan payments resumed.

Our advice was to convert the case to Chapter 7.  Reduction in income should solve the prior means test problem and enable the debtor to get the relief he originally sought.  In doing so, the debtor will save tens of thousands of dollars.

There are always solutions to problems if we are willing to work hard and apply our Krekeler Strother creativity.


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