What Is A Reaffirmation Agreement?
A reaffirmation agreement is an agreement by which a bankruptcy debtor becomes legally obligated to pay all or a portion of an otherwise dischargeable debt. Such an agreement must generally be filed within sixty (60) days after the first date set for the meeting of creditors. If the reaffirming debtor is not represented by an attorney, the debtor or creditor must file an application for approval of the agreement, along with a request for hearing. You must appear in person at the hearing. The judge will ask you questions to determine whether the reaffirmation agreement imposes an undue burden on you or your dependents and whether it is in your best interests. Since reaffirmed debts are not discharged, the bankruptcy court will normally only reaffirm secured debts where the collateral is important to your daily activities. Reaffirmation agreements are strictly voluntary. The Bankruptcy Code or other state or federal law does not require them. You can voluntarily repay any debt instead of signing a reaffirmation agreement, but there may be valid reasons for wanting to reaffirm a particular debt. Since a reaffirmation agreement takes away some of the effectiveness of your discharge, legal counsel is advisable before agreeing to a reaffirmation. Even if you sign a reaffirmation agreement, you have a minimum of sixty (60) days after the agreement is filed with the court to change your mind. If your discharge date is more than sixty (60) days after the agreement is filed with the court, you have until your discharge date to change your mind. If you reaffirm a debt and fail to make the payments as agreed, the creditor could take action against you to recover any property that was given as security for the loan and you may remain personally liable for any remaining debt.
Other Debt Relief FAQs
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What About My Student Loans – Can I Discharge Them?
In general, student educational loans are not discharged under bankruptcy. There are exceptions in which a court may discharge the debt especially where paying … more -
I Am Involved In A Short Sale Situation With My House And The Lender Wants Me To Sign A Promissory Note For The Difference – Will I Be Able To Discharge This Note In Bankruptcy.
This is a common tactic by lenders in a short sale situation. However, if you sign the note then try to file for bankruptcy shortly thereafter, you may have a … more -
What Is A Discharge?
The discharge order is issued by the court and permanently prohibits creditors from taking action to collect dischargeable debts against the debtor personally; this … more -
What Debts Are Dischargeable?
11 U.S.C. Section 523 lists exceptions to discharge. In general, all other debts are dischargeable. Some debts listed in Section 523, such as those based on fraudulent … more -
What Is A Priority Debt?
A priority debt is a debt entitled to priority in payment in a bankruptcy case. A general listing of priority debts is given in 11 U.S.C. º 507 of the Bankruptcy … more -
What Is A Secured Debt?
A secured debt is a debt that is backed by property. A creditor whose debt is secured has a right to take property to satisfy a secured debt. For example, most homes … more -
What Is An Unsecured Debt?
A debt is unsecured if you have simply promised to pay someone a sum of money at a particular time, and you have not pledged any real or personal property as … more -
What Is An Administrative Debt?
An administrative debt is a priority debt. An administrative debt is created when someone provides goods or services to your bankruptcy estate. The best example of an … more -
What Is Redemption?
Redemption allows an individual debtor (not a partnership or a corporation) to keep tangible, personal property intended primarily for personal, family, or household … more -
What Should I Do If I Cannot Make My Chapter 13 Payments?
If the debtor cannot make a Chapter 13 payment on time according to the terms of the confirmed plan, the debtor should contact the trustee by phone and by letter … more
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