Legal Question in Bankruptcy in California

Absolutely. First, you cannot borrow money (a mortgage) while in a Chapter 13 bankruptcy without court approval. The approval process is going to require that your plan payments remain the same, or are higher after the borrowing so creditors are not adversely impacted by your acquisition of new debt. Second, where are the funds coming from for the down payment and closing fees and costs? The Court is going to examine that very carefully as well. Finally, and this is the most practical question - who is going to give you a mortgage while you are actively in a Chapter 13 bankruptcy? I know of no lenders willing to do so. You need to review this with your bankruptcy attorney. If you don't have one, you will need one to even consider purchasing a home while in bankruptcy.

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