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cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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We have filed Chapter 13. We currently have a 401K loan. My

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We have filed Chapter 13. We currently have a 401K loan. My sister has agreed to lend us the money to this loan off so we can re-borrow and pay off the Chapter 13. Is this legal or even a possibility

cfortunato :

Hi - my name is XXXXX XXXXX I'm a Bankruptcy attorney here to assist you.


cfortunato :

Yes - you would be able to borrow money from your sister - either to pay back the 401K or to directly pre-pay your Chapter 13 plan. However, you would first have to get approval from the Bankruptcy trustee.

cfortunato :

Once your Chapter 13 is paid in full, your case can be discharged and closed, and you can then start to re-pay your sister and your 401K loan.


We have attorneys retained for the length of the bankruptcy would we have them go to the trustee?


cfortunato :

Yes - if you are using an attorney, your attorney(s) would have to contact the trustee.

cfortunato :

The trustee will approve this, because trustees are very much in favor of getting their money and the creditors' money early.

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