borrowing from annuity?

[helpsoneeded]

Are we allowed to borrow money from my husbands annuity plan from work. I do know we would have to pay ourselves back along with 6% intrest, but is it allowed and how would the trustee know if you did it? We want to take between one and two thousand to try to get caught up on things. We are currently on 1 year of a 5 year plan. Thanks

[LadyInTheRed]

In reponse to "how would the trustee know if you did it?" I don't know, but is it worth having your BK dismissed if the trustee does find out? Don't do it without talking to your attorney.

In fact, IMHO, just don't do it. Taking a loan to make ends meet is taking a step back towards where you were before filing BK, even if it is really a loan from yourself. You will have to make payments on the loan, leaving you less to live off of when you apparently are already having problems paying your expenses.

If you are behind and you have to "get caught up on things," either you need to figure out how to stay within your budget or your plan is not realistic. You need to deal with whatever has put you behind right now. Take a close look at where you are spending. Is there somewhere you can cut back? Try using your Sched J expenses as a guide. If you really cannot cut back, you need to talk to your attorney about modifying your plan before things get worse.

Try to resist the urge to reach for a temporary solution that will only hurt you in the long run. You've made it through the first year. Keep fighting to successfully get through four more, one difficult step after the other.

[debtinohio]

You plan/trustee information should clearly state what the limit of post-petition debt is. Mine says anything > $1000 I need to ask the trustee first. LadyInTheRed is right, check your budget or check your plan.

[momofthree]

My paperwork also states that I have to get permission to borrow anything over $1000.

It's a very bad sign that you "need to get caught up on things" only a year into your plan. Like ladyred said either your lifestyle or your plan needs to change.

[helpsoneeded]

Its very hard to live the way we have to. We only got 100.00 dollars extra allowed for the month. They put us on a very tight schedule and trying to raise teenagers and one is going to college has been very difficult. The money that we had to pay upfront for college was crazy. It was just fees and room downpayments that needed to be in by a certain date. She cant apply for student loans yet because we are waiting for the final amount we need and we know she cant the full amount needed to go,so thats gonna fall on us. We are in a bind and unfortuantely theres not a whole a person can do when you just dont have the money.....

[momofthree]

Unfortunately, when you're in a 13, your children have to be responsible for their education on their own. It sucks, but it is what it is. It's doubtful the trustee will approve you to take on debt to help fund your daughter's education. And it simply isn't worth the risk of having your case dismissed to take on the debt without permission.

[HHM]

Bottom line, if you take a loan from any sort of retirement account during a 13 you are shooting your chapter 13 in the foot. As was pointed out, the short term benefit of getting the money is outweighed by the long term increase in your fixed expenses by needing to pay back that loan.

Don't do it.

Time to teach your daughter a lesson here...if she wants an education (just like if she wants anything in life), SHE needs to figure out how to pay for it. Let her own desire and drive be unleashed; you really will be surprised the lessons that can be learned by forcing necessity. (as you are learning in your chapter 13).

[LadyInTheRed]

She cant apply for student loans yet because we are waiting for the final amount we need and we know she cant the full amount needed to go,so thats gonna fall on us.

Has your daughter filled out a financial aid application? Unless things have changed, financial aid eligibility, including federally guaranteed student loans, is calculated based on the fees and living expenses associated with a particular school. You don't need to determine a "final amount" in order to apply. She should apply asap if she hasn't already. Keep in mind that the financial aid award will be based on your recent income tax returns and assume that the family will contribute to expenses. Since this often doesn't reflect reality, the "expected family contribution" can be quite shocking. After she receives notification of the financial aid award, your daughter may have to go meet with a counselor at the financial aid office to discuss her situation (including her parents' bk) and have things revised. It's a scary thing for a 17 or 18 year old to have to deal with, but the financial aid counselors are very understanding and are there to help.

I've always thought that a big part of what you learn in college is how to get through the maze of a large institution in order to advocate for yourself. It's a good skill to learn.

Many college students in this country manage to go to college without any financial assistance from their parents because many parents are struggling themselves. It won't be easy, but your daughter can do it. You may not be able to support her financially, but you can give her moral support and guidance in navigating life as an adult. One thing she may need to consider is attending a 2-year college before transferring to a university. My father is a retired college professor from a 4-year. He has always said you can get a better education in the general education courses at a 2-year school where classes are smaller. It's a lot cheaper too!

Your other teenagers should also be thinking about how they are going to pay for college. You may want to encourage them to get part time jobs if they don't have them already, or even full time jobs in the summer (I realize this may be tough in the current economy, but its worth a try). It will only make a small dent in what is needed for college, but every little bit helps. They should also work on keeping their grades up and keep an eye out for scholarships they can apply for, even if they are small $500 or $1,000 grants. Do a google search for "paying for college" and I bet you will find sites where they can search for scholarships to apply for.