re-affirming....

[mickeysfriend]

I guess I dont really understand how this works. I have our second appointment with my attorney Oct 7, but I'm curious NOW.

At our first appointment the attorney mentioned that we could reaffirm our house and car loans. This is what my husband wants to do for sure, which would be nice...BUT, I guess my understanding was that we had to be CURRENT on the loans in order to reaffirm.
Somehow, my husband understood that the banks tend to negotiate on the loan amounts in order to not have to repossess or foreclose. It makes some sense considering the state of the economy, but doesnt sound logical in many ways.

any help?

[TEW]

Reaffirming a loan basically reverses the BK on that loan. If you are behind on the loan/mortgage you have to bring it up to date before you can reaffirm. Unless the car is in good shape low mileage ect. I would think twice. There are ways to cure a mortgage like ask them to move missed payments to the back of the loan. That will most likely raise payment because now you have more interest.
One problem with Reaffirming a loan is that if you find you can not pay it and you are discharged you have no BK protection.. You can not file again for 8 years. So you end up with a car that is worth less then you owe and you are having trouble selling it or paying for it. And it gets reposed you will be stuck with any deficiencies on that loan.

[Overmylimit]

My lawyer said if I was current on my mortgage that he would advise against reaffirming, he said just to keep paying and sustain but never reaffirm only if you are behind.

[TEW]

My lawyer said the same thing DO NOT reaffirm anything......... and I am not

[b_girl]

Only re-affirm if you want to keep the items and can afford to keep paying them into the future...as stated, you cannot file BK again for another 8 years, so if you fall behind or change your mind, you will be sued for any deficiencies should you stop paying.

If you don't re-affirm, it's possible you can do a ride-through on both the house and the cars but it's not a given. In our area, we could have done a ride-through on the cars, but our attorney told us that in no way would a ride-through work on our mortgage. He warned us that any lender would most likely foreclose on us, despite our monthly payments. My husband didn't want to rent, so we did re-affirm the mortgage and HELOC, but the payments are reasonable and the remaining balances are equal to the equity in the home.

But don't count on your lender to work with you on lowering the interest rate/monthly payment on your mortgage....we tried that with our lender and they absolutely refused, saying they 'weren't allowed'. Yeah, right. Too bad the Bailout bill didn't allow the judges to act on our behalf to change unfair loan terms.

[Overmylimit]

I think it depends on where you live also, if they were to foreclose on my home they would lose so much it wouldn't be worth it. I had an apprasial a year and a half ago for 890k now the value is like 400k my mortgage is like 620 so they would be better off taking my paymnets.

[Overmylimit]

I think it depends on where you live also, if they were to foreclose on my home they would lose so much it wouldn't be worth it. I had an apprasial a year and a half ago for 890k now the value is like 400k my mortgage is like 620 so they would be better off taking my payments.

[Cali]

My attorney(30 yrs experience) suggested we reaffirm the truck and the company said we either reaffirm or lose it. We reaffirmed. We were never late on the truck.