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reaffirm secured credit card?

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    #1

    reaffirm secured credit card?

    I have a secured credit card I put 4k down on when I knew I was letting my house go, and I figured the credit card companies would slash and burn (which they have) before my financial situation took a turn for the worst. I have charged it up to 3k, so..

    So should I turn it back in, and just pay it off prior to bk, or should I reaffirm it. If BK goes through as planned I could pay it off within a few months or so.

    My lawyer doesn't know he hasn't seen a case like it.
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    #2
    Unless I'm mistaken, you actually have an asset in the remaining part of the card (deposit) that wasn't used. If you deposited 4K, and used 3K, then that should leave around 1 thousand dollars that is your money. Did your attorney feel that this should be disclosed as an asset?
    Filed Chapter 13 02/2006 - Confirmed 05/2006 - Discharged 09/2011
    I'm not an attorney. My replies are merely suggestions or observations, not legal advice. As always, consult with an attorney before making any decisions.

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      #3
      Originally posted by newbie2 View Post
      Unless I'm mistaken, you actually have an asset in the remaining part of the card (deposit) that wasn't used. If you deposited 4K, and used 3K, then that should leave around 1 thousand dollars that is your money. Did your attorney feel that this should be disclosed as an asset?
      I was thinking the same thing that it might be an asset because I used my money for it. Although in CA we get quite a bit of allowance for assets so I will probably be ok. I am going back to see him this morning so I will continue to ask about it.

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        #4
        Do what? As soon as you file BK, I can pretty much guarantee your account will be closed and the amount of your balance will be taken from your deposit account. It will be up to the Trustee to decide to get that back from the secured card holder (preferential payment), but I would bet dinner that the exercise in reaffirming will be wasted - I'll bet the account goes away and the remaining deposit would fall under your CA exemption.

        Search the forums here - I have seen this discussed before.

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          #5
          Originally posted by btbeme View Post
          Do what? As soon as you file BK, I can pretty much guarantee your account will be closed and the amount of your balance will be taken from your deposit account. It will be up to the Trustee to decide to get that back from the secured card holder (preferential payment), but I would bet dinner that the exercise in reaffirming will be wasted - I'll bet the account goes away and the remaining deposit would fall under your CA exemption.

          Search the forums here - I have seen this discussed before.
          That is good advice-I went on Monday and closed it out and will be getting back the money left over, around $800 either way the CA exemption is quite high so I can use it now to pay some living expenses.

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