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Reaffirmation

creatures
New Member

Reaffirmation

Hi,
I filed for bankruptcy several months ago. Through the whole process, I told my lawyer I wanted to reaffirm my car loan. My lawyer mentioned reaffirming, his secretary/clerk mentioned reaffirming, the trustee asked if I was going to affirm. I said yes. At every point my lawyer said reaffirming was later. Now I've got a discharge and my car loan is not reaffirmed. I find out that the reaffirmation was supposed to have happened ages ago. I had no idea. The way they talked about it I thought it was after the discharge.

The lawyer is difficult to get ahold of. He has risked the success of my bankruptcy case several times by filing incomplete paperwork, not filing things I'd sent to him, etc. Do you have any advice? Who do I talk to next? I called the lawyer and he told me he'd call me back after he reviewed the case. That was 45 minutes ago. My credit union (with the car loan) said they can't tell me anything about anything because that would be giving legal advice.

If I paid off the car loan right now (with another loan) would that solve it?

Thanks so much for any help. I thought bankruptcy was going to take a load off my shoulders but it's been constant difficulty and stress for months, mostly because of my attorney.
4 REPLIES 4
StartingOver10
Moderator Emerita

Re: Reaffirmation


@creatures wrote:
Hi,
I filed for bankruptcy several months ago. Through the whole process, I told my lawyer I wanted to reaffirm my car loan. My lawyer mentioned reaffirming, his secretary/clerk mentioned reaffirming, the trustee asked if I was going to affirm. I said yes. At every point my lawyer said reaffirming was later. Now I've got a discharge and my car loan is not reaffirmed. I find out that the reaffirmation was supposed to have happened ages ago. I had no idea. The way they talked about it I thought it was after the discharge.

The lawyer is difficult to get ahold of. He has risked the success of my bankruptcy case several times by filing incomplete paperwork, not filing things I'd sent to him, etc. Do you have any advice? Who do I talk to next? I called the lawyer and he told me he'd call me back after he reviewed the case. That was 45 minutes ago. My credit union (with the car loan) said they can't tell me anything about anything because that would be giving legal advice.

If I paid off the car loan right now (with another loan) would that solve it?

Thanks so much for any help. I thought bankruptcy was going to take a load off my shoulders but it's been constant difficulty and stress for months, mostly because of my attorney.

Why don't you just continue to pay the loan and keep the car without a reaffirmation?  

 

From what I remember the attorney has to sign off on the reaffirmation agreement and some attorney's are reluctant to do so.  

 

Also, in the long run, if you keep the car and continue to make your payments on time, it is a non-event.  Having said that, did you discharge other debt with the same CU that financed this vehicle?  If so, the answer might be different.

Message 2 of 5
NormanFH
Super Contributor

Re: Reaffirmation


@creatures wrote:
Hi,
I filed for bankruptcy several months ago. Through the whole process, I told my lawyer I wanted to reaffirm my car loan. My lawyer mentioned reaffirming, his secretary/clerk mentioned reaffirming, the trustee asked if I was going to affirm. I said yes. At every point my lawyer said reaffirming was later. Now I've got a discharge and my car loan is not reaffirmed. I find out that the reaffirmation was supposed to have happened ages ago. I had no idea. The way they talked about it I thought it was after the discharge.

The lawyer is difficult to get ahold of. He has risked the success of my bankruptcy case several times by filing incomplete paperwork, not filing things I'd sent to him, etc. Do you have any advice? Who do I talk to next? I called the lawyer and he told me he'd call me back after he reviewed the case. That was 45 minutes ago. My credit union (with the car loan) said they can't tell me anything about anything because that would be giving legal advice.

If I paid off the car loan right now (with another loan) would that solve it?

Thanks so much for any help. I thought bankruptcy was going to take a load off my shoulders but it's been constant difficulty and stress for months, mostly because of my attorney.

 

A reaffirmation simply keeps you "on the hook" for the loan. You can continue to voluntarily pay, and keep the vehicle or you can walk away from it with no further repurcussions. If you need an installment loan for rebuilding purposes, just get a small secured loan from a CU like SDFCU, Alliant, Penfed, etc. You get just as much score mileage from it.

Most Recent FICO 8 Scores EX616/TU587/EQ607 01/09/2018 Starting scores 553/485/543 08/25//2017
~~~Credit lines~~~~
SDFCU VISA Secured $250
Discover Secured $200
Message 3 of 5
gwennie
New Member

Re: Reaffirmation

Hi, 

 

My case just closed yesterday and I am happy to day that I decided not to sign the reaff for my car loan.  I've been paying as agreed but it feels good to know that while I'm rebuilding that if something happens, the loan will just be included with all the other discharged debt.

 

When speaking to my loan servicer (Chase), they were vague about the agree to pay option because they wanted me to sign and obligate myself to the life of the loan.  I think this may have actually worked out in your favor.  According to my attorney, they prefer you to sign the reaff but most servicers/banks are good with you just continuing to make the payments.

 

Just a thought to share - wish you the best of luck.

Filed 6/13/17
341 7/20/17
Discharged 9/25/17

11/17: EQ 639 EX 632 TU: 617
Message 4 of 5
DaveInAZ
Senior Contributor

Re: Reaffirmation


@creatures wrote:
Hi,
I filed for bankruptcy several months ago. Through the whole process, I told my lawyer I wanted to reaffirm my car loan. My lawyer mentioned reaffirming, his secretary/clerk mentioned reaffirming, the trustee asked if I was going to affirm. I said yes. At every point my lawyer said reaffirming was later. Now I've got a discharge and my car loan is not reaffirmed. I find out that the reaffirmation was supposed to have happened ages ago. I had no idea. The way they talked about it I thought it was after the discharge.

The lawyer is difficult to get ahold of. He has risked the success of my bankruptcy case several times by filing incomplete paperwork, not filing things I'd sent to him, etc. Do you have any advice? Who do I talk to next? I called the lawyer and he told me he'd call me back after he reviewed the case. That was 45 minutes ago. My credit union (with the car loan) said they can't tell me anything about anything because that would be giving legal advice.

If I paid off the car loan right now (with another loan) would that solve it?

Thanks so much for any help. I thought bankruptcy was going to take a load off my shoulders but it's been constant difficulty and stress for months, mostly because of my attorney.

First of all, welcome to MyFico forums!

 

Secondly, dishonest attorney like yours really tick me off. IN my 2010 BK7 my attorney did the same thing - I wanted to reaffirm my mortgage, attorney argued against it & reluctantly agreed. All during the process it was "yes, your mortgage will be reaffirmed", but what he didn't tell me & what your attorney didn't tell you is that to reaffirm the lender has to send a reaffirmation agreement & it has to be signed by your attorney, you, the court and the lender, and then recorded by the court in your BK case.

 

Some are advising you to just continue to pay on time and keep the car. That is usually good advice as when the debt is discharged in BK you are no longer personally liable for it, if you have problems in the future and fall behind on payments all they can do is take the car. If reafirmed, they can take the car and make you pay any shortage over what they sell the car for and what you owe.

 

BUT most credit unions will not allow that, if you do not reaffirm the loan they will repossess even if you have never been late. That's because most credit unions put a clause in the loan docs that if you file BK you are automatically in default even if always paid on time.

 

The credit union should be able to answer one question that is not "legaL advice": If you continue to make all payments on time will they let you keep the car?

If the answer is "Yes", then just keep paying & keep the car.

If the answer is "No" then you need to consider - is the value of the car less than the loan balance? (you can check the car value at kbb.com, Kelly Blue Book)

If the car is worth less than what you owe you need to consider letting them repo the car and get another one.

If the car is worth more than what you owe, and/or you really, really want to keep it then yes, getting a new loan & pay the current loan in full that would solve the problem. But, just out of BK you'll probably pay much higher interest rate.

 

Good luck 

Message 5 of 5
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