Conversion and Bankruptcy Reform Legislation

I received a very good question from one of you and I wanted to take some time to address it. The person is currently in a Chapter 13 plan and due to a change of circumstances needs to convert the case into Chapter 7. The question was if they were unable to convert their case until after the new bankruptcy legislation takes effect in October, if they would now have to comply with all the new regulations? The answer is NO, thankfully. The new legislation only affects "new" cases. Cases that are "commenced" after October 17, 2005. Generally, converting a case from one bankruptcy proceeding to another does not create a new "commencement" date. For purposes of the new legislation, the general rule applies and converting the case doesn't create a new "commencement" date for purposes of determining which version of the bankruptcy code applies to the case after conversion. Thus, for the example above, the converted case will be governed by the law as it was on the date of the original Chapter 13 filing, not the date the case was converted. I received a very good question from one of you and I wanted to take some time to address it. The person is currently in a Chapter 13 plan and due to a change of circumstances needs to convert the case into Chapter 7. The question was if they were unable to convert their case until after the new bankruptcy legislation takes effect in October, if they would now have to comply with all the new regulations? The answer is NO, thankfully. The new legislation only affects "new" cases. Cases that are "commenced" after October 17, 2005. Generally, converting a case from one bankruptcy proceeding to another does not create a new "commencement" date. For purposes of the new legislation, the general rule applies and converting the case doesn't create a new "commencement" date for purposes of determining which version of the bankruptcy code applies to the case after conversion. Thus, for the example above, the converted case will be governed by the law as it was on the date of the original Chapter 13 filing, not the date the case was converted.