Is our loan reaffirmed or not?

[SleepWellNow]

I've got a question I hope someone can answer regarding reaffirmations in Chapter 7s. Does the trustee/court have to approve a reaffirmation? Prior to our discharge, we signed a loan mod for our house agreeing to a reaffirmation. Three days after the lender received our notarized paperwork back, we were discharged. I have been told, since we signed the reaffirmation while in active BK and the lender did not get an approval from the trustee/court, the reaffirmation is not valid. Can this be possible?

[lrprn]

Does the trustee/court have to approve a reaffirmation?

If you file without a lawyer, then yes, the court judge does have to approve a reaffirmation agreement.

I have been told, since we signed the reaffirmation while in active BK and the lender did not get an approval from the trustee/court, the reaffirmation is not valid. Can this be possible?

If your lender did not return a signed copy of the reaffirmation agreement to the court before your discharge and closing, then there is no reaffirmation agreement.

I don't know your personal circumstances, but in most cases experienced bk lawyers will tell you that it's best to *not* reaffirm any secured loans when you file. As long as you continue to make on-time payments without fail, the lender has no reason to come after the asset involved.

Not having a reaffirmation agreement means that if you get into unexpected financial trouble in the future, you can walk away from the asset owing nothing. This may turn out to be a big favor for you.

[SleepWellNow]

lrprn -Thank you for responding. I filed with an attorney but he is no longer with the firm. His replacement is not very responsive, probably because he doesn't know our case well and we have already been discharged. I have a couple of questions that may help others also...

1. Are you saying the court does NOT have to approve the reaffirmation if an attorney represents a debtor? If so, how is a reaffirmation handled if an attorney is involved?

2. If a debtor has been discharged but not closed, can the lender still send the reaffirmation in for court approval?

FYI - We were 7 months behind and owed back property taxes. We needed the mod (with reaffirmation) if we had any hopes of saving the house.

P.S. I see you've made over 8,000 posts. I'm sure I'm not alone is wanting to express thanks for your help and contributions to so many people. Big thanks!