Skip payment, then reaffirm auto

[KKAB]

I would like to file Chapter 7 this month. If I skip a vehicle payment so I can pay the filing fee will they still let me reaffirm this loan? My only assets will be the house and car. I am not using an attorney so I can save money.

Also, do you ALWAYS have to appear in front of the judge if you are filing pro se and want to reaffirm a loan?

[PaKettle]

Most attorneys advise you not to reaffirm a car in most cases.

My attorney told me "just keep paying it, I've yet to have one client who had their car repossessed during or after a bankruptcy as long as you keep paying it and on time".

So I would not advise skipping a payment. Get the money somewhere else.

I'm not an attorney but maybe some others can chime in here on this one to confirm what I say. I think you do have to appear in front of a judge or trustee (not sure which) if you want to reaffirm a loan, even if you have an attorney. But again I'm not an attorney, just saying what I think I have heard. Good luck.

[HHM]

If you are filing Pro Se, you should keep current on the car and get the filing fee some other way. Trying to do a reaffirmation pro se can be problematic.

[KKAB]

I'm confused as to why one wouldn't reaffirm. Don't you have to reaffirm to keep a vehicle? It would be awesome if I could just keep paying and keep my car! The car may be worth a couple hundred over what we owe. Thanks for the advice!

[HHM]

As long as you keep current on the payments, the car company cannot repo your car...and you do not have to reaffirm.

[PaKettle]

One does not reaffirm, according to my attorney, because it is not in one's best interest.

Let's say something terrible happens and you can't pay the car any more after 6 months after discharge. If you reaffirm you would still have that debt on your credit record and they could come after you for it, attach your wages or whatever.

By not reaffirming, you do not owe the debt, really. They CAN come take the car but they pretty much "never" do as long as you keep paying.

I wanted to reaffirm but everyone - my attorney and people here - explained that reaffirming is not in my best interest.

I am paying the loan each month, should get my discharge any day now, and have not heard any word from the bank holding the loan on my car. The one thing is, you should set up the car on an automatic payment so you don't miss one because if it's worth much and you miss a payment I imagine they will come right out to get it!

That is the one thing. I THINK they would maybe give you a little more leniency on missing a payment by a week or so, if you reaffirmed. But it is my belief (not sure) that they will jump to repossess if you don't reaffirm, and if the car is worth much in re-sale value (like if it's relatively new).

But EVERYONE including my attorney told me not to reaffirm, so I did not.

[KKAB]

I guess I didn't realize what a reaffirmation was exactly! And, because you two seem so knowledgeable, I have one more question on the topic! We pay this loan 29 days behind. For instance it is due on the 21st of the month, we pay it for the previous month on the 20th. Is this considered "behind"? We have our finance through the same company, BOA, as our biggest credit card at $8000. I am hoping they'll be nice to us! Thanks for the clarification on reaffirming.

[007nco]

I did the same thing, but was late by 2 payments. I did catch up before the relief of stay was granted (allowing them to repo) and then talked to the creditor (Chrsler Financial in this case) and they said as a courtesy, they will allow you to keep the vehicle as long as payments are on time. When I asked to have that in writing, they said, sure. Just sign the reaffirmation! They are happy to let you sweat about a possible repo, but in reality it will cost them more to repo and resale than to allow you to keep on making payments. Good luck!

[danaf]

there are pros and cons to both reaffirming and not reaffirming. In reaffirming, if you can get the creditor to agree in writing and actually comply to actually reporting favorably to the credit bureaus than that will help build your credit back up after bk. However you will be on the hook for the loan if you cannot repay.

If you don't reaffirm and keep paying, they most likely will not report favorably to the credit bureaus however you could walk away at any time from the loan without further reprocussions because it was already included in the bk.

[PaKettle]

I guess I didn't realize what a reaffirmation was exactly! And, because you two seem so knowledgeable, I have one more question on the topic! We pay this loan 29 days behind. For instance it is due on the 21st of the month, we pay it for the previous month on the 20th. Is this considered "behind"? We have our finance through the same company, BOA, as our biggest credit card at $8000. I am hoping they'll be nice to us! Thanks for the clarification on reaffirming.

If I were you I'd simply call them and ask, or have your attorney ask if you have one. I've been told to be careful what you say to creditors before filing, so if you have an attorney ask him to ask them maybe (if he won't charge you too much to do so). Or just call them yourself but don't make them any promises or anything, just ask your questions get your answers and get off the phone.

In fact maybe you don't even have to identify your self or your loan. Just call up and say "I have a general question about a car loan. How long after the actual due date is it considered "late"? Or maybe it's better to just say the truth that you are in bankruptcy, that you are not reaffirming but want to keep your car and wonder how late you can pay before they will consider it "late"?

What do you experts here think? Should KKAB just call and ask?

I'd be very careful with Bank of America if thats what you mean by BOA. Bank of America are some of the biggest a-holes in the banking business in my opinion. They tend to have no mercy or human qualities whatsoever. The person you get on the phone *might have* but the Corporation itself does not.

It's good you only owe them $8k. We owed them like $30k. And once that debt is officially discharged I will be PARTICULARLY HAPPY about having discharged that debt from BOA! They deserve having it discharged, for many reasons.

Anyway, I'd do the best you can to start paying your car debt on time and keeping it on time. Set up an automatic payment after your discharge if you can. That's what I plan to do. Don't set up an automatic payment before filing or they could possibly take money out of your account.

And the other poster is right, generally speaking it's just not in their best interest to repo a car that someone is making payments on.

One more thing: Once you are in bankruptcy you won't be able to pay by net probably, and they probably won't even send you the bills in the mail. So keep an old bill and copy it and you'll have to send a copy with your payment every month in your own envelope. I'm not sure if they'll start re-sending bills or allowing me to pay on the net again after the discharge or not.

Anyone know if they allow you to pay by net again after the discharge?

[woohoogirl]

I have to add my 2 cents worth. I made all my monthly loan payments right before I filed, so that I had a month to get everything sorted out as to what form of payment I could use to make those payment. I had been using my free online bill pay provided by my bank. I called my mortgage company (First Horizon) and spoke with some one in the bankruptcy department. I told her that I had filed a week ago and I was just wanting to find out if they would continue to accept an electronic funds transfer from my bank account at another bank. She told me that with it being included in bankruptcy that the payment would be rejected. I asked if I could set it up so that First Horizon would debit my account each month for my payment. She was very nice and set it up and it will take effect this payment coming up. I asked if it was possible for me to continue to get a monthly statement....she said no problem. I got one yesterday. Now onto my car....after dealling with King of the Morons at BB&T, I finally ended up with a somewhat more pleasant and a bit brighter woman in the loan operations. We went through what forms of payments they would accept. They would not set up a debit from my account to pay them (like FH did), but I could make the payment at any branch or I could use my bank's online bill pay (that FH wouldn't). So it all experiences are totally different. I will say that the car people told me this and I've said this to several people. Banks are in the banking business, not the real estate market or car dealership market. Most banks should work with you, it's just a matter of getting in touch with a person that has a clue. Most people don't and most people don't care. It's all about looking out for number one.
I'll get off my soapbox now. Hope that someone got something out of that....

[Lindsay]

Our lawyer told us not to reaffirm our vehicle. We only have about payments left out of the original 60 payments. That made me nervous as it is getting close to being paid off. He said to make sure its paid on time each month.

[diviaruba]

Not necessarily true...

As long as you keep current on the payments, the car company cannot repo your car...and you do not have to reaffirm.

... see my post here:

http://www.bkforum.com/showpost.php?p=143680&postcount=13