Ride-through option for Statement of Intention

[GbMarupo]

I am a little confused on how I can do the ride-through option for my Statement of Intention. On the form, I am supposed to mark that I am going to reaffirm the debt. But are there any additional things I need to do, like file a reaffirmation agreement with the court? I am planning on doing a ride-through with a car.

[drowning123]

Don't sign the reaffirmation agreement. Ask the lender if they'd be willing to do a ride-through. If they're not, then either you lose the car or you reaffirm. It's really up to you.

[ccsjoe]

Your SOI form should give you three options, reaffirm, redeem or surrender. You can mark reaffirm, just don't sign the reaff agreement itself. And follow drowning's advice of contacting your lender to see if they're cool with a ride through.

[gman]

I am going through this same issue right now.

Understand that there are LEGAL steps in this process as well as UNWRITTEN ones.

Legally - you need to tell the court you are looking to reaffirm the debt OR that you are going to surrender the vehicle OR that you are going to pay off the balance. In many states, like mine, the choice of "ride through" is not one the court is interested in.

So - what do you do?

First - call your bank/credit union and ask them what they do when a debt is NOT reaffirmed. As an example - mine told me that "they have the right to repossess the vehicle" but that many times if the borrower is not and has not been late (which is my case) - they simply will not spend the money/time/effort to repossess.

Second - decide if you are going to TRY and reaffirm or not. In my case, I am going to TRY and reaffirm, but the Court/Judge OR the bank/credit union might not agree because I am unemployed. I actually am expecting that to be the case. But - I am not worried. As long as I make payments, I know how the bank/credit union is likely to act (which is the most important thing to know.)

If they change their mind, so what? I have two options: 1. refinance the car to another lender (already have offers in the mail and my case is not discharged yet) OR 2. sell the car and pocket the equity...it's actually worth a few grand more than what is due.

Hope this helps....Understanding how your lender is likely to act if it is NOT reaffirmed is what matters most.

[jlynn275]

If they change their mind, so what? I have two options: 1. refinance the car to another lender (already have offers in the mail and my case is not discharged yet) OR 2. sell the car and pocket the equity...it's actually worth a few grand more than what is due.

So if they won't let you reaffirm you would be able to sell the car before it gets repo'd....before the dischcarge?

[gman]

So if they won't let you reaffirm you would be able to sell the car before it gets repo'd....before the dischcarge?

Short answer = yes.

I live in metro Atlanta, so I have already taken the car to CarMax for a sell-it-on-the-spot quote.

The bank/credit union has told me they would inform me prior to doing a repo, especially given that I am not late and never have been.

In addition, the bankruptcy itself protects me from a repo until the discharge or dismissal is granted.

I also could refinance the loan with another bank/credit union.

It's all about knowing your options.

With that being said, there are horror stories out there about certain lenders (Ford Credit is a prime example) who have a policy to repo on the spot. If I had a car loan with them, my strategy would be different.

[jlynn275]

hmm, interesting. This is the biggest question mark in my plan right now. Attorney is advising I don't reaffirm my car because it's so upside down, but I WANT my car because it's reliable for my commute and I don't want to deal with trying to get a buy/here/pay here questionable car in the midst of everything else. I'm terrified I will continue to pay after not reaffirming and they will take it, but I'm also scared to alert them to the BK. At what point did you call to inquire about this? And should I call if I don't plan to reaffirm, but keep paying? Sorry, don't mean to hijack....can you tell I'm stressing? lol

[tcreegan]

Hi Gb,

cssjoe, drowning, gman...thanks, good job!

Just wanted to add a couple things...marking 'reaffirm' on the statement of intentions is not a reaffirm. To reaffirm you go through a process; signing papers, filing w/ the court, a hearing, judge rules on it, you get the picture.

As others have said, reaffirming is rarely a good thing to do. But legally your lender can require it. But if it doesn't get done b4 discharge, tough cookies for the lender. And even if it did get done, you can rescind it within 60 days; again tough cookies for the lender.

Now legally the lender cannot repossess if you are current on the loan; the law is 11 U.S.C. §541(c) BUT, that doesn't mean they won't.

As others have said, check with your lender...

Tom in Colo

[gman]

hmm, interesting. This is the biggest question mark in my plan right now. Attorney is advising I don't reaffirm my car because it's so upside down, but I WANT my car because it's reliable for my commute and I don't want to deal with trying to get a buy/here/pay here questionable car in the midst of everything else. I'm terrified I will continue to pay after not reaffirming and they will take it, but I'm also scared to alert them to the BK. At what point did you call to inquire about this? And should I call if I don't plan to reaffirm, but keep paying? Sorry, don't mean to hijack....can you tell I'm stressing? lol

Don't stress about contacting your lender.

Remember - you are asking them about their policy and processes. Trust me, they get 100s of cases like yours each month.

You are getting information to decide on a strategy. Without the information, you will worry yourself sick with a million what'ifs.

Be prepared for an answer that was like the one I heard...."our official policy is to repo BUT as long as you are making payments we likely will not come after your car."