I have seen these words mentioned in several posts that I read. Can someone please explain?
affirm and reaffirm are being used for the same thing. You affirm or reaffirm a debt, meaning that you tell the court and the creditor that you are going to keep paying the debt, and it will not be wiped out by the bankruptcy. generally only for houses, cars, etc...though sometimes can talk the court into approving an unsecured debt being reaffirmed if there is a co-sigern involved.
REMEMBER, THIS IS NOT LEGAL ADVICE.
This is based off my knowledge from my BK 7 back at the end of 07.
When you reaffirm a debt in your BK it makes you legally liable for paying it again. It is exempt from the rest of the bankruptcy proceedings. The reaffirmation has to be approved by the BK judge.
Example...I wanted to keep my minivan so I singed the reaffirmation agreement, but due to my financial issues at the time the judge denied the reaffirmation (The judge won't allow you to reaffirm a debt if he thinks you will not be able to pay it). At that point Ford could have taken the van back, but I continued to pay them on time every month and they let me keep the van and that was a year and a half ago.
I hope this helps.
I have a friend in this very same situation. She set up a reaffirmation with her lender, but the court ultimately did not approve it, claiming it's not in her best interests. Her lawyers told her that doesn't matter. I'm concerned that she will keep making payments on the vehicle, then the lender can take it at any time, even if she has it almost paid off! RIght now, she's probably a couple grand upside down. I advised her to give it back to the lender and allow it to be discharged. But she loves her truck and doesn't want to give it up, even at $500/month. I'm just scared they will wait until she pays more down, then snatch it. What is the legal position on this? Are my worries justified?