What are the rules for spending money during Chapter 13 Bankruptcy?

Under Chapter 13 bankruptcy law in California, those who are in debt have the opportunity to reorganize their financial obligations while they keep their assets. Part of this process includes determining how to spend the money that is leftover after debt payments are made. The rules for spending money while in a Chapter 13 bankruptcy are as follows: all disposable income must be deposited into a bankruptcy estate, and the Trustee will determine what is spent on payments and what should be saved. The debtor must submit a monthly budget of their income and expenses to the Trustee for approval. Additionally, the debtor must get approval from the Trustee for any major expenditures. In addition to the approval from the Trustee, the bankruptcy court must also approve any purchases that are not covered in the monthly budget. This means that the debtor must go through the court in order to make any large purchases, such as a car or home purchase. Finally, there are certain activities which are not allowed while the debtor is in a Chapter 13 bankruptcy. These activities include gambling, taking cash advances, and taking out loans. Spotloans and Payday loans are also not allowed while a debtor is in a Chapter 13 bankruptcy. These rules are in place to ensure that the debtor’s finances are managed properly and that their debts are paid off efficiently.

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What are the rules for spending money during Chapter 13 Bankruptcy?

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