reaffirmation agreement what happens if the attorney doesn't sign it?
by Lane Becker
Published 2 years ago
Updated 1 year ago
8 min read
Signing the reaffirmation agreement results in the debt surviving the chapter 7 bankruptcy discharge, and your liability for the reaffirmed debt continues on,unaffected by the discharge of debts. The problem is that your lawyer might refuse to sign it. Yes, you read that right: your lawyer can refuse to sign the reaffirmation agreement.
Can You Reaffirm If the Attorney Doesn't Sign? If this is the case, you can still file the agreement without his or her signature, along with your explanation as to how you believe you can afford it despite the budget deficit. The court will then schedule it for a hearing.
What happens if you don't sign a reaffirmation agreement?
If you don't sign a reaffirmation agreement, the lender can repossess your car after your case closes and the automatic stay lifts. Some car lenders are known to repossess the car immediately, even if you are current on payments.
What happens if you don't sign a reaffirmation agreement mortgage?
Reaffirmation agreements, although required by the bankruptcy laws for every secured debt that the debtor will continue to pay, are often not necessary in practice. This is because the only penalty for failure to sign the reaffirmation is that the creditor might repossess the collateral securing the loan.
Can I change my mind on a reaffirmation agreement?
Can I Change My Mind and Cancel the Agreement? Yes. You can cancel (or “rescind”) your reaffirmation agreement, even if a judge has already approved it. NOTE: WE STRONGLY RECOMMEND THAT YOU SPEAK WITH AN ATTORNEY TO ADVISE YOU ABOUT THE CONSEQUENCES OF CANCELLING A REAFFIRMATION AGREEMENT IN YOUR CASE.
What happens if you default on a reaffirmation agreement?
If you reaffirm your car loan and later default on it, you could end up back in debt that you can't afford to pay. For this reason, it's important to carefully consider if reaffirmation is right for you. Can you afford your monthly payment?Aug 17, 2020
What does it mean if a mortgage is not reaffirmed?
When debt is discharged in bankruptcy, the bankruptcy petitioner is no longer personally responsible for that debt. Therefore, if a homeowner files bankruptcy, does not reaffirm the debt, and receives the discharge, he or she is no longer liable for the outstanding balance and the mortgage.Jan 7, 2020
Can I refinance if I did not reaffirm my mortgage?
The truth is that you do NOT have to reaffirm your loan to refinance. There is no law that says anything like that. The hurdle is not a law, it is just the bank's policy. They may have chosen not to offer to refinance to people who chose not to reaffirm.Jun 7, 2018
Can I cancel a reaffirmation agreement?
Yes.You can cancel (or “rescind”) your reaffirmation agreement, even if a judge has already approved it. NOTE: WE STRONGLY RECOMMEND THAT YOU SPEAK WITH AN ATTORNEY TO ADVISE YOU ABOUT THE CONSEQUENCES OF CANCELLING A REAFFIRMATION AGREEMENT IN YOUR CASE.Mar 11, 2016
This means that your mortgage debt will not be discharged in the bankruptcy and you will be liable for the debt. But it also means that you will get to continue living in your house.
What does it mean when a debt is not reaffirmed?
If the debt has not been reaffirmed and there is a default, the lender may only pursue its collateral and will not be able to pursue the individual if there is any money still owing.Oct 12, 2016
Can a debt be reaffirmed after discharge?
If you decide to reaffirm a debt, you must do so before the discharge is entered. You must sign a written reaffirmation agreement and file it with the court. The Bankruptcy Code requires that reaffirmation agreements contain an extensive set of disclosures.Apr 7, 2021
Can you reaffirm unsecured debt Chapter 7?
Reaffirmation agreements are entirely voluntary. No creditor can make you reaffirm a debt. This is because a reaffirmation goes against the most basic upside of filing bankruptcy: the fresh start. You cannot be sent to collections, sued, or garnished on a debt that was discharged in bankruptcy.
How long does it take to file a reaffirmation agreement?
The completed reaffirmation agreement needs to be filed within 60 days after the first date set for the meeting of creditors. The Cover Sheet for Reaffirmation Agreement ( Official Form 427) needs to be attached to the signed reaffirmation agreement.
What is a reaffirmation hearing?
The reaffirmation hearing. Alternatives to reaffirming your car loan. Conclusion. People who file bankruptcy are often concerned about what's going to happen to their car . Signing a reaffirmation agreement is one option that lets you keep your car and continue making the payments, but it's not the only option and might not be ...
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Can you keep your car after bankruptcy?
People who file bankruptcy are often concerned about what's going to happen to their car. Signing a reaffirmation agreement is one option that lets you keep your car and continue making the payments, but it's not the only option and might not be the best option in your situation. Read on to learn about how reaffirmations work ...
What is secured debt?
The most common secured debts are mortgages, which are backed by real estate and car loans, which are secured by the vehicle. The creditor of a secured debt – known as a secured creditor – has the right to repossess the loan's collateral or force a sale if the borrower doesn't make the payments.
What happens at the end of a Chapter 7 bankruptcy?
At the end of a successful Chapter 7 bankruptcy case the filer receives a bankruptcy discharge, which erases their personal liability to pay back certain debts. Although the filer will no longer be personally liable to pay back a secured debt, the loan is still connected to the property.
What questions do you ask at a reaffirmation hearing?
At a reaffirmation hearing, the judge will ask questions to determine whether the court should approve or deny your reaffirmation agreement. Typical questions include whether you're current on the loan payments, whether there's equity in the vehicle, whether you understand the terms of the agreement, why you want to reaffirm this debt, and whether your monthly expenses exceed your income, and if so, how you plan to afford the monthly payments of the reaffirmation agreement.
What is a reaffirmation agreement?
The reaffirmation agreement essentially creates a new contract for the debt between the debtor and the creditor. It allows the creditor to continue collecting on the debt you owe—the debt will not be discharged as part of the bankruptcy. In order to enter into a reaffirmation agreement, the debtor cannot be behind on the loan.
Can you reaffirm a Chapter 7 bankruptcy?
In short, a Chapter 7 debtor should never sign a reaffirma tion ...
Can a debtor receive a discharge?
Once the debtor’s estate has been liquidated, she or he can be eligible to receive a discharge of her debts. In practical terms, this means that any non-exempt property is sold, the proceeds are used to pay off debts inasmuch as possible, and then the debtor gets a clean slate for any debts that are dischargeable.
What is Chapter 7 bankruptcy?
As you may know, Chapter 7 bankruptcy is also called liquidation bankruptcy, which refers to the fact that a debtor’s assets (or those assets that are not exempt) are liquidated in order to repay creditors.
What happens if you sign a reaffirmation agreement?
If you sign a reaffirmation agreement and one of these happens, then the creditor can sue you to collect the balance.
What is collateral in bankruptcy?
The collateral is usually a car or a house for consumer bankruptcies. The creditor, however, wants money, not collateral, so the creditor prefers to continue to receive payments and interest rather than take the collateral.
What are some examples of a symlink?
Examples of this are: 1 Losing your job so you can’t make payments 2 Getting your car or house destroyed by an accident or fire not covered by insurance