Q: Do I have to pay off CH 13 creditors if I sell my house and have the proceeds from the sale?
We are selling our home and just got our Ch 13 plan confirmed. Do we have to pay off the entire Bankruptcy and creditors with the closing of the sale?
A: Yes, unless you dismiss your petition or your homestead exemption completely covers your equity in the house. As your house is part of the bankruptcy estate, it likely should not be sold without permission of the court while the case is active.
A: You must inform your attorney before you list or advertise your property and discuss what you want to do. Selling your property sometimes requires a court order that may take about thirty days to obtain. If the home’s sale can pay off your repayment plan, then you can expect a discharge of your Chapter 13 after the sale.
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