Is there any problem with paying off a 401k loan after filing if you use exempt cash? I was laid off and have an outstanding 401k loan that I'll need to pay off soon. I have enough cash to pay it off that will be exempt due to my homestead exemption. Could a trustee object that is a preferential payment if it is made AFTER I file chapter 7?
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It's not a preference when paying yourself.
I would still seek an attorney to explain if there are any other pitfalls. Besides, any post-petition items are not within the scope of the bankruptcy estate. Of course, you should wait until discharge before you move property around (or convert property) because it may still be property of the estate.
Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
Status: (Auto) Discharged and Closed! 5/10
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Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.
Bankruptcy Wizard
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