2 years into 5 year 100% plan. Want to pay off early. Questions. TY!

[Tbarker]

Hey guys!

I am two years into a five year 100% plan. I am in Illinois, and I want to pay off early. I've searched around and I feel like I'm getting a little confused on the "stay in for 36 month" rule of thumb. Also, I am being offered this money as a loan from a family member, so I don't know if that complicates things. It would seem to me, if I'm in a 100%, that it doesn't matter if I pay it off or how I do it.

I typically would just stay in the plan, but I have a lot of new regulations coming up in about three months at work where the 13 could be a big no no. I plan to contact the lawyer in the next day or two, but I was just curious if anybody had any insight.

I greatly appreciate your time!

[kornellred]

You are in a rather unique situation. If all of your creditors are going to be paid off entirely, it seems to me that there is no basis for an objection from the trustee. How you handle repaying the family member should not be of any concern, either. Keep the forum posted on this - even though the odds of any other debtors finding themselves in your situation are long indeed.

[Tbarker]

Keep the forum posted on this - even though the odds of any other debtors finding themselves in your situation are long indeed.

I certainly will! thanks

[frogger]

I have a different take on this:

You're 2 years into a 13, so you are learning how to budget and maintain control of your finances. A loan from your family defeats that purpose, and... you're borrowing from family.

Don't do it.

[Pandora]

agree with frogger... why borrow that money? It wont matter if you pay off your Ch. 13 for your job or not.. your BK will be on your credit report for 7 years. Does your work have a clause about "no BK allowed else termination" - because if they do, thats illegal

[Tbarker]

Just a heads up for anybody that might have the same issue. The attorney said that all I have to do is call him for the remaining amount and mail in a check. He did ask where the funds would come from, and I told him a family loan. He had nothing negative to say about that at all.

[nsupanda]

I'm very very green at all this bankruptcy stuff, but at our 341 meeting we had to sign a paper stating we would not enter into any type of loans/debts while we were in the ch. 13 (5 years). I don't know if that's how it is for everyone everywhere, but if it is, wouldn't this be considered entering into a debt while in bankruptcy? I don't know your situation, but that sounds like a bad idea and I wouldn't do it unless I absolutely HAD to. Best of luck!

[TShoot]

Could be a "gift" from his family. If that were true, he wouldn't be taking on any additional debt. Play on words maybe but why would the Trustee even care if everyone got paid in full?

[nsupanda]

That's true.

[Mayo]

I agree with frogger. Money and kin don't mix.

[frogger]

Could be a "gift" from his family. If that were true, he wouldn't be taking on any additional debt. Play on words maybe but why would the Trustee even care if everyone got paid in full?

IMO, the "gift" here is for the filer to be discharged of all debt and have a fresh start. BK is about being honest, not gaming the system. Why would a trustee care about a play on the words? Because the trustee is here to insure that the system works and works fairly for all. To go into debt will require the trustee approval.

[TShoot]

They wouldn't be going into debt if it truly was a gift. No additional debt incurred.

[TShoot]

Though my lawyer did say they like you to be at least 3 years into the plan before they will consider it.