[CLBS] Is CH 7 Trustee entitled to increased equity in converted case?

[Holly Roark]

This is a CDCA CH 13 case. We are at the end of the case. Junior mortgage
submitted statement saying mortgage is not postpetition current ($19K). CH
13 trustee has filed Motion to Dismiss. Considering converting to CH 7 to at
least get rid of unsecured debt, but house value equity has ballooned to
about $400K. Is CH 7 Tee entitled to this equity in a converted case? 

 

Other options: 

1.	Dismiss and refile CH 13, but will be 100% plan as opposed to 0%
plan debtor has been in for 5 years based on equity increase. Bummer. 
2.	Debtor is looking to modify Jr. mortgage to put postpetition arrears
on end of loan (this has to happen real fast, like within 10 days), and see
if they will submit revised statement to trustee stating debtor is now not
in postpetition arrears. Not sure if this is a viable option though since
technically Debtor did not comply with plan terms. 

 

Let me know your thoughts.

 

Best regards,

HOLLY ROARK

Attorney at Law 

Certified Bankruptcy Specialist -

By the State Bar of California Board of Legal Specialization

 

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