Chapter 13 and 401k loan.
Question Details: I am 2.4 yrs into my chapter 13 bankruptcy and 1 month away from a planned step up. The step up is based on a 401k loan that is about to be paid off with the extra weekly amount being applied to the bankruptcy. Question: will the trustee allow me to take another loan out on my 401k to pay approx. 85% of my bankruptcy off and then adjust the remaining amount that has to be paid over the last half of my bankruptcy plan? I live in NY state. Thanks-
Bankruptcy Law Answers
It is difficult to answer this question without knowing who the trustee is. I would suggest that if you have an attorney, that attorney send a proposal to the trustee to seek his or her opinion. In general, you cannot "borrow" money without the permission of the court during a chapter 13 plan.
David B. Shaev
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