05-02-2012 08:24 AM
BMW has started reporting my auto loan after reaffirming the debt. I had to send them my discharge paperwork. I spoke with a representative over thephone that said it would happen automatically but it could take up to 60 days from the Sunday after my next payment. I did not want to wait that long especially since they treat the account as a normal debt. They auto draft and send my invoices with a due date. I sent a secure email through the MyBMW page and they replied quickly telling me to attach my discharge paperwork. When I went to do an online dispute this morning with EQ my auto loan was reporting!!! I am not buying a score at this time until my credit card statements are cut with correct utilization.
05-03-2012 02:48 PM
Okay my Car Loan is back to reporting on my reports and it states Reaffiemation of Debt and it made my score INCREASE by a whopping 8 points. Not the reason I reaffirmed but I thought it would have increased by more. Only 6 more payments and it is finished anyways.
06-28-2013 11:23 AM
Ok, to put this issue to bed I called one of the trustees I know and specifically asked him about car reaffirmation/repo. Here is a quick summary of what he said:
First and foremost, not all reaffirmation applications will be approved, it's largely up to the trustee in the case, and if he/she feels it's a bad idea they won't approve it. Secondly, a trustee (and/or the court) may give a lienholder an EXPLICIT right to reposess a vehicle whose loan is current. This time, its up to the trustee/court and they may do it if there are multiple vehicles, or the believe there was extravagent or intentional spending that doesn't warrant a dismissal. (i.e. "I"m going to ignore my credit card payments and go buy this car I can't afford). He added that the petitioner (person filing the BK) can also get EXPLICIT instructions to a creditor that they are NOT to reposess a car (regardless of reaffirmation) unless the debtor misses a payment.
So what happens when the discharge papers from the BK Court specifically state that although the reaffirmation agreement appears to be properly completed, the Trustee does not approve it? Is it still valid? Does the debtor have to return the vehicle?
I have a friend who is in just such a situation. The discharge went through, but stated that the reaffirmation was not approved because he felt it would continue to place an undue hardship on the debtor. However, her attorney is telling her that doesn't matter, that the reaffirmation agreement is in place between her and the lender, and to keep paying for the vehicle. I'm trying to explain to her that she needs to quit paying and turn the vehicle in and allow the debt to be discharged, but she just seems attached to the otherwise ordinary truck. She doesn't even have any equity in it... possibly a couple grand upside down still.
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