a reaffirming question

[bizrock]

Ok quick questions my wife and I are going to file a BK and have 1 auto loan that we would like to keep. Can we not reaffirm and just make payments and keep it? or can the bank take it back? also we have some secured loans on House hold items can we do the same? any help would be great. we are in Utah not sure if that changes anything.

[chad9162]

Yes, not reaffirming is called a ride through. Most here believe as long as you're current on your loans hen you should be able to keep them but no guarantee. The auto would be more of a risk for repo than say a house, because with a house they still have to go through foreclosure proceedings. If you're current they can't foreclose

[frizole]

you can reaffirm only if both party's agree to it. If your loan is through a bank, they most likely will reaffirm. There are sub-prime lenders out there that won't reaffirm though. Also, if your loan is through a bank or credit union, and you are upside down on it, and you want to gamble, you might be able to get them to charge off a portion of the debt.

[CH33 Paralegal]

you want to review your state's repossession laws.

[frizole]

you want to review your state's repossession laws.

I could be wrong, but I think bizrock asked about reaffirmation, and not repossession

[chad9162]

I could be wrong, but I think bizrock asked about reaffirmation, and not repossession

The OP ask what the risk (repossession) would if he didn't reaffirm. Some states have laws against repossession if you are current. Although the law has not yet bet challenged

[frizole]

The OP ask what the risk (repossession) would if he didn't reaffirm. Some states have laws against repossession if you are current. Although the law has not yet bet challenged

Yes, my bad. I only read the first question, and thought that would be more of a positive outcome, (note to self, read all post first). In hind site I do think the 2nd question is moot until reaffirmation explored and is dealt with. As I stated b4, very few companies out there will not reaffirm debt, and simply repo on a loan. Furthermore, I would be surprised to see a lender try and repo while a client is under bankruptcy protection. Usually if a lender will not reaffirm, there is a set surrender date of mutual agreement of said property.

[StartingOver08]

Ford and Chrysler are known to pick up the vehicles if you don't sign a reaffirmation agreement. This is an interesting article on the reason they continue to reposses even if you are current.

See the entire article in the link here: http://www.doanlaw.com/blog/?p=11

..But when the new Bankruptcy Laws went into effect on October 17, 2005, many car creditors took the position that they could now repossess your car if you filed a bankruptcy, even if you were up to date on the payments and wanted to keep it.

As it turned out, only a few lenders like Ford and Chrysler actually started repossessing vehicles after bankruptcy when the client still remained current and no reaffirmation agreement was signed. Why? Good question. If the debtor is current on his payments and ends up paying the car off, certainly the lender would receive more than they would at auction since at auction they only receive a firesale price which then must be reduced further with the costs of sale. Likewise, even if a debtor pays for some time after the Bankruptcy and then lets the car go back to the lender, the lender is still in a better off position since they at least received contract payments for a period of time in addition to the final sale proceeds. ...

Read the rest of the article in the link above.

[frizole]

Ford and Chrysler are known to pick up the vehicles if you don't sign a reaffirmation agreement. This is an interesting article on the reason they continue to reposses even if you are current.

Exactly if YOU DON'T sign. this post is digressing. bizrock's question is "Can we not reaffirm and just make payments and keep it?" So, to help save him some headache, it's best to try and point out reaffirmation is the best possible route when applicable, and yes most lenders would like to reaffirm when possible, that way they can still get atleast their principle back, and not have to send it to a wholesale, or auction

[StartingOver08]

.... Can we not reaffirm and just make payments and keep it? or can the bank take it back? .

This was the question I was answering. I do not know the lender involved. Ford and Chrystler has reputations for picking up vehicles that do not have a signed reaffirmation agreement. I was answering this question.

You are right. I should have asked who the lender was before answering. I did not mean to get the thread off track. Sorry for the hijack

[bizrock]

my concern is its with my bank and I have a Credit card threw them that we will be including in BK and I'm not sure how they will take that. Anyone been threw this before?

[FakeName]

Here's the thing I keep thinking about as I worry about not re-affirming my home...

The banks don't have the facilities in place right now to foreclose on the people who actually aren't paying their mortgages. The system is so bogged down that people are able to live in their homes for years in some cases without making a payment.

So why should someone current on payments be concerned when the banks can't keep up with the "real" foreclosures out there?

[frizole]

bizrock, I have, that is why I posted what I did. I had a credit card with a 5k balance, and an auto loan with a 11,500 balance. I originally was going to surrender the van because the transmission was going out (2005 freestar). The bank asked me to reaffirm it, they lowered the interest rate, and dropped 3,500 off of the principle (3500 was the cost to replace the tranny). A deal that sweet I couldn't pass it up.

[LuciluS]

Below is another post concerning Reaffirmations and/or Ride Throughs & Repossessions.

http://www.bkforum.com/showthread.php?t=40073

Luci

[bizrock]

Thanks so much for all the help!