Reaffirmed a vehicle and now I can't afford it....

[amanda074]

I filed Chapter 7 in November 2008. I am expecting to be discharged in the next week or two. I reaffirmed my vehicle with GMAC Finance because I thought it was the best thing to do at the time... now I have lost my job and need to get rid of the vehicle. I am upside down by about $8,000 and don't have the money to make that difference. What will happen when I call GMAC and tell them to "come and get it"....

[AngelinaCat]

Hi, Welcome to the forum.

You are the 'classic' reason why many posters here advise not reaffirming a vehicle, instead, keep making the payments on time as you normally would do. This is called a 'ride-through'. If the worst happens, as it did in your case, then you can surrender the vehicle and not be responsible for the 'difference' when the vehicle is sold at auction. You reaffirmed, so if you surrender it now, and it is sold, you WILL be held responsible for the difference between what you owe, and what it will sell for at auction.

Now, having said all of that, let me ask some questions:

Do you have an attorney, or did you do your BK yourself? If you have an attorney, talk to him or her ASAP.

It may be possible to amend your paperwork somehow to get this reaffirmation rescinded. That you will need professional help with. And there will proabably be additional legal fees involved. There may be posters on board here with similar experiences, who might be better able to assist.

You might be able to renegotiate with GMAC about the loan--they aren't in the best of shape these days, either, and might just be happy getting a few dollars less a month, than having a white elephant of a vehicle to deal with.

Good luck to you, and again, welcome aboard!

[PoorGrammyinBK7]

I am pretty sure you can rescind this prior to discharge.

[whipster1]

Yep you can rescind. Gotta do it quick!

Here's the code language:

(4) the debtor has not rescinded such agreement at any time prior to discharge or within sixty days after such agreement is filed with the court, whichever occurs later, by giving notice of rescission to the holder of such claim;

And the explanation:

“Your right to rescind (cancel) your reaffirmation agreement. You may rescind (cancel) your reaffirmation agreement at any time before the bankruptcy court enters a discharge order, or before the expiration of the 60-day period that begins on the date your reaffirmation agreement is filed with the court, whichever occurs later. To rescind (cancel) your reaffirmation agreement, you must notify the creditor that your reaffirmation agreement is rescinded (or canceled).

Here's the link to the part of the BK code: http://www4.law.cornell.edu/uscode/h...4----000-.html

[AngelinaCatHub]

HEY, do this QUICK as when you are discharged, you are dog meat to them. ACT NOW! 'Hub

[fyi2]

I thought you could cancel your reaffirmation as long as it was before discharge ...???

[liz417]

I thought you could cancel your reaffirmation as long as it was before discharge ...???

You can...refer to 'Hub's subtle message above