Will a 401k loan affect my bankruptcy? 9 Answers as of May 25, 2011

I just filed bankruptcy and it has not been discharge as of yet. I would like to take a loan out on my 401K, will this affect my bankruptcy from being discharged?

Ask a Local Attorney. 100% Anonymous. Free Answers.

Free Case Evaluation by a Local Lawyer: Click here
Indianapolis Bankruptcy Law Office of Eric C. Lewis
Indianapolis Bankruptcy Law Office of Eric C. Lewis | Eric Lewis
You should wait until the discharge is given.
Answer Applies to: Indiana
Replied: 5/25/2011
Burnham & Associates
Burnham & Associates | Stephanie K. Burnham
Obtaining a loan from your 401K should not affect the discharge of a Chapter 7 Bankruptcy, this is NOT the case if you had filed a Chapter 13.
Answer Applies to: New Hampshire
Replied: 5/25/2011
Bankruptcy Law office of Bill Rubendall
Bankruptcy Law office of Bill Rubendall | William M. Rubendall
You cannot take a loan from your 401K during bankruptcy without losing your right to claim it exempt. Wait until discharge. At that time your assets, including this, revert to you (go back to you.)
Answer Applies to: California
Replied: 5/25/2011
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
Maybe. Essentially you are converting an exempt asset to a possibly non-exempt asset (cash). It will depend on how much you pull out and and whether or not the trustee has filed a "no asset" report.
Answer Applies to: California
Replied: 5/25/2011
The Northwest Debt Relief Law Firm
The Northwest Debt Relief Law Firm | Thomas A McAvity
At a minimum, you will need to wait until after the meeting of the creditors and after a discussing the matter with your attorney.
Answer Applies to: Oregon
Replied: 5/25/2011
    Greifendorff Law Offices, PC
    Greifendorff Law Offices, PC | Christine Wilton
    It depends on whether you're filing chapter 7 or 13 and whether you're repaying that loan will impede providing any monies to your unsecured creditors. It's best to consult with an attorney.
    Answer Applies to: California
    Replied: 5/25/2011
    The Law Office of Mark J. Markus
    The Law Office of Mark J. Markus | Mark Markus
    It depends in part on what Chapter you filed, but if it's a Chapter 7 case, it shouldn't affect anything.
    Answer Applies to: California
    Replied: 5/24/2011
    The Schreiber Law Firm
    The Schreiber Law Firm | Jeffrey D. Schreiber
    That depends on whether the retirement account was exempt and if the time for the trustee to object has passed. It is better to wait until the case is closed to be certain the trustee is not going to claim any of the account.
    Answer Applies to: California
    Replied: 5/24/2011
    Jackson White, PC
    Jackson White, PC | Spencer Hale
    If you are in a chapter 13 then you need permission from the court. If you are in a chapter 7 then you should be fine taking a loan out so long as the 401k was claimed as exempt.
    Answer Applies to: Arizona
    Replied: 5/24/2011
Click to View More Answers: