Refi out of a Chapter 13 Bankruptcy bailout.

[fiats3]

So here's the deal. After 9 months or so going back and forth trying to determine my house's equity and what kind of monthly payment I can afford, we settled on $500/mo x 60mos + $10,000 at the back end as a lump sum + all my tax refunds for next 5 years (approx.another $10K). That's $50K total. I don't want to live for 5 years under the Chap 13 trustee's microscope and have to submit paystubs to her to show overtime pay, etc. I won't be able to get loans, credit anything. I want to refi house and give her a lump sum of $50K and walk away.

Has anyone else done that? What is the process? Do you have to convert
back to a Chapter 7 in order to do that, or can we do that deal in a Chap13. I don't want to open my home equity back up to questioning as she may discover more $ and try and take it....Do I need to get confirmed first and them broach my proposal, or should I just get a continuance in my case and have a loan company get the judge's permission to explore a possible refi...
I mean it's not a done deal that I can refi the 50K, but I think it's a strong possibility...if I fail then I just revert back to $500/mo payment plan strategy, right...?

[Minnymouth]

In chapter 13 you can't do ANYTHING without the approval of the Trustee.... buy or sell any large ticket items... This would include refinancing......

In order to refinance in a Chapter 13 and pay off the Trustee...............then you would have to refinance (with approval) and pay your creditors off at 100% of what you owe them. (ruins the purpose of filing a chapter 13). At the present time in your chapter 13 you are only paying out disposable income to the creditors over the payment plan time period.

If you go to a chapter 7 and have equity in your home that is not exempt........... the Trustee can seize the home and sell it for the equity....

Its a catch 22 situation.......... The Trustee is going to get the money one way or the other....

Sit down and discuss you options with an attorney... see what he says....

[SinkingFast]

Is this an Old Law or New Law filing??

Is your current payback at the 100% level to begin with??

We need more info.

Another person here did refi their house and bought their way out of Ch 13. But they were at a 100% payback level to begin with. They'd been the plan for a while before doing the refi and pay-off. It wasn't like they maxed out the equity in their home to do the refi to pay-off the 13 plan.

http://www.bankruptcyforum.com/showthread.php?t=5915

There's lots to consider.

[StaciMM]

Fiats3-my understanding is that you can refi out after 36 months of payments, and just finish paying off what you had originally been scheduled to. BUT to pay out before 36 months, you'll have to pay 100% of debts. Its bankruptcy, not lets make a deal.

[13inOR]

Here is what our trustee wanted to consider approval for the refi we did:
1. preapproval from a mortgage lender
2. closing estimate (from the title company) showing how much the loan was for, the payoff amounts to current mortgage, and the amount being paid to the trustee for bk payoff.
3. preliminary title report

So, there is no way to keep the trustee from knowing your homes value, but these are the steps we had to go about to get ours done. And like has been mentioned, if its before 36 months you will end up paying back 100% even if you weren't currently in a 100% payback plan. It worked great for us, as we were already paying 100%, but there are things to consider in each situation.
Best wishes on whatever you decide!