What problems am i going to have with this plan to buy a manufactured house

[reboot2]

details.
We are 2 years into a chapter 13.
We where pre-approved for a loan (have not done the full loan app yet), but they know we are in a ch 13 and ran our credit 615 is our score.
We want to cash out 401k to use as down payment on a manufactured house.
We want to put the house on family land (it's not in my wife's name but could be deeded to her. It might have to be deeded to her for the loan)

[Pandora]

did you get approval from your Trustee before applying for the loan? If not, this will be a problem....

Dont touch your 401K - bad idea. You can search the forums and you will find several posts as to why its a bad idea.

[reboot2]

I thought you had to get the approval from the bank (but not sign) to submit to the trustee

[Pandora]

If you are looking to purchase anything using credit / loans - you should always call your attorney FIRST and find out if you're able to do so; they will tell you how to proceed if you're able.

General rule of thumb is you're not supposed to incur ANY new debt while in a Ch. 13. Your confirmation order will have it typed on it; in some instances you can incur small debt (for instance, ours states less than $5000) without Trustee / Judge approval but again, its up to the Trustee and Judge and it will also be on your confirmation order.

I'd call your attorney today and run everything you've done thus far by him/her before going any further.

[reboot2]

Just called them. They told me to get the approval and all the details and meet with the attorney to submit for approval. Couldn't answer any of my questions though about the 401k, deed of the land, etc. As of right now we are giving away $1300/month in rent.

[BKAttyMI]

Be very wary, while you are "giving away" money in rent right now, manufactured homes don't tend to retain a lot of value. You may "give away" more money for a mortgage to purchase this property, maintain it, decorate it, etc. and still have nothing to show for it in the end.

You aren't giving away anything for shelter, you're paying for shelter, which is a necessity.

[reboot2]

we are reviewing our options, We can get the same exact house as a modular but it's 20k-30k more because it takes more to install it and ties the land to the mortgage but has a better interest rate. We have the family property to put it on that some day will be ours when the time is right.

Right now rent is $16000.00 a year or at 5 years of rent $78000. That is true depreciation IMO.

[dmc-2008]

It would change your taxes which would change your income and dmi, so see what those numbers look like. Good luck.