Choice of Staying in Chapter 13 or Converting to 7? Circuits Show It Makes a Difference

Eighth Circuit, like the Ninth, has ruled that when Chapter 13 cases are converted to Chapter 7, any increase in a debtor's home value beyond exemptions and liens becomes part of the Chapter 7 estate. See also: Critical Case Comment – Post-Petition/Pre-Conversion Equity

Unlock This Article

To get started, please let us know which of these best fits your current position:

Learn more about the membership.

Please sign in to continue reading this content.
William-1_print_2019
Editor/Adviser, Academy for Consumer Bankruptcy Education

The Honorable William Houston Brown retired in 2006 as a United States Bankruptcy Judge for the Western District of Tennessee, and he had been designated to sit also in the Middle District of Tennessee, Southern District of Florida, Eastern District of Michigan and Western District of Kentucky. Judge Brown served a four-year term on the Bankruptcy Appellate Panel for the Sixth Circuit from 1999 through 2002. He received his law degree from the University of Tennessee College of Law, where he was Order of the Coif. Judge Brown is a member of the American Bankruptcy Institute, having served on its Board and Executive Committee, and he is a Fellow in the American College of Bankruptcy. He is the author or co-author of several texts, including Bankruptcy Exemption Manual, 2005 Bankruptcy Reform Legislation with Analysis 1st and 2d editions, Bankruptcy and Domestic Relations Manual, The Law of Debtors and Creditors, as well as bankruptcy form books, all published by Thomson West. He is also a principal contributing editor for Norton Bankruptcy Law and Practice 3rd, published by Thomson West. Judge Brown prepares a quarterly update of consumer cases for the Federal Judicial Center, which distributes those materials to all bankruptcy judges, and he is a speaker at the Federal Judicial Center’s annual seminars for bankruptcy judges. He also speaks regularly at seminars throughout the United States, on consumer bankruptcy topics. Judge Brown co-authors Chapter 13 Bankruptcy 4th ed., a digital publication, available at ch13online.com. Judge Brown also acts as a mediator in bankruptcy-related disputes, has conducted mock trials, and has testified as an expert witness in bankruptcy court proceedings.

Related Articles

October 18, 2020
By Riley F. Tunnell, Esq., Godwin Bowman PC (Dallas, TX) The COVID-19 pandemic is not the product of a single cause. So, our remedial efforts must address a myriad of causes and rapidly developing effects. The CDC believes that delaying the onset of the mass-eviction to a time when we may be better able to manage this virus is a...
Members
March 7, 2021
By Chris Hawkins, Bradley Arant Boult Cummings LLP (Birmingham, AL) The Consumer Financial Protection Bureau (CFPB) published its debt collection final rule in the Federal Register on November 30, 2020, revamping the Fair Debt Collection Practices Act (FDCPA) for the first time since its enactment in 1977. Despite written comments submitted by several industry groups requesting clarity in areas where...
Members
Copy of Hildebrand-2016
November 20, 2022
A golf cart is a motor vehicle and may be exempted by a Chapter 7 debtor under state law. (Loyd) In re Smith, 2022 WL 3023209 (Bankr. W.D. Okla. July 28, 2022) Case Summary Bobby Smith filed a Chapter 7 petition and listed his golf cart as an exempt asset under Oklahoma law because it was a “motor vehicle.” The...
Members
Copy of Hildebrand-2016
September 18, 2022
Insurance proceeds generated due to a totaled car treated under the “hanging paragraph” of 1325(a) covers the entire claim; interest, however, is not recalculated even though it was a higher rate than the interest paid under the plan. (Hanan) In re Pagan, 638 B.R. 887 (Bankr. E.D. Wis. Jan. 24, 2022) Case Summary Bankruptcy judges have been overheard saying that...
Members
August 25, 2019
By Karin N. Amyx, Staff Attorney to the Trustee Carl Davis (Wichita, KS) To me, the word “timeshare” conjures up images of a dark conference room at a resort hotel where unwitting tourists are being goaded into signing usury contracts in exchange for a free meal ticket at the buffet. But what is a timeshare? And how do you deal...
Members
Copy of Hildebrand-2016
June 18, 2023
The Ninth Circuit has now joined its sister Circuit in holding that the Bankruptcy Code does not permita Chapter 13 Trustee to retain the percentage fees collected on payments that a chapter 13 debtor made pre-confirmation in accordance with 26 U.S.C. §586 but, upon dismissal prior to confirmation of the plan, is obligated to return the fee to the debtor,...
Members
M Joseph Photo 2-1-22
May 8, 2022
Faced with abusive and serial bankruptcy cases,courts have fashioned various sanctions to put a stop to gaming the system. The favored sanction of the majority of courts is to enter an order of dismissal with prejudice under Section 349(a) of the Bankruptcy Code that adds a condition prohibiting refiling another bankruptcy case for a set period of time. See Lundin...
Members
November 8, 2020
By James J. Robinson, Chief United States Bankruptcy Judge, Northern District of Alabama When do the trustee’s duties end, and who gets the money? Harris v. Viegelahn, 135 S. Ct. 1829 (2015). This opinion of the unanimous Court requires the trustee to return to the debtor undistributed plan payments—originating from wages earned postpetition—on hand at a good-faith, post-confirmation conversion rather...
Members
Copy of Hildebrand-2016
August 28, 2022
Unanticipated post-petition acquisitions, constituting property of the estate, can be captured for the purpose of repaying creditors. In re Powell, 2022 WL 1043502 (Bankr. C.D. Ill. April 7, 2022)(Perkins) Case Summary Clarence and Betty Powell filed a Chapter 13 petition in February of 2020 and their plan was confirmed that October. The plan required the Powells to make monthly payments...
Members
QueneshiaFleming
October 29, 2023
I am delighted to be in the inaugural class of the Tom Vaughn Memorial Internship Program for Sylvia Ford Brown, Chapter 13 Standing Trustee for the Western District of Tennessee in Memphis. I truly feel that this internship has been invaluable to the furtherance of my career and the expansion of my knowledge of bankruptcy.  I. A Little About Me...

Looking to Become a Member?

ConsiderChapter13.org offers a forum to advance continuing education of consumer bankruptcy via access to insightful articles, informative webinars, and the latest industry news. Join now to benefit from expert resources and stay informed.

Webinars

These informative sessions are led by industry experts and cover a range of consumer bankruptcy topics.

Member Articles

Written by industry experts, these articles provide in-depth analysis and practical guidance on consumer bankruptcy topics.

Industry News

The Academy is the go-to source for the latest news and analysis in the Chapter 13 bankruptcy industry.

To get started, please let us know which of these best fits your current position: