Credit union didn't sign reaffirmation, and I am cross-collateralized! Help!

[PMACK]

My BK was discharged March 2009 and is now closed. I signed a reaffirmation for the car, but the credit union didn't sign or return it because it didn't have the cross collateralization clause in it, and I had a $6,000 credit card through them. I recently called for a 10-day payoff and found out I owe $6,000 more than my previous balance because of the cross collateralized debt. I owe a total of $13,000 now, and the car is only worth about $6,000.

If I walk away now, can I be sent to collections for this or am I not obligated because the reaffirmation wasn't filed? What if the car is in bad shape? Can they try to make me pay for its mechanical/physical problems after they repossess it? Where in the BK code does it say whether I'm obligated or not?

If anyone wants a recommendation for a law firm in the Reno NV area that consistently drops the ball and avoids contact with you after you've paid, PM me!

[PMACK]

Umm.... I thought that it was just my lawyer who never answered my legal questions. Anyone? Hello? Bueller?

[newbie2]

I'm not a lawyer, so take this with a few grains of salt: Your bk was discharged. (That includes the debt to your credit union.) You are not on the hook for the car since you didn't reaffirm it. If it were me, I would ask them where they wanted the car dropped off. Then they can eat the debt on the car AND on the unsecured loan.

[Charlie777]

A reaffirmation only occurs if the BK Court approves the agreement. Since your CU didn't return it and it wasn't approved by the court, it's null and void. You owe nothing on the Credit Card or the car, the CU retains a security interest in the car, probably for the cross-collateralized amount. I agree with newbie2, keep paying until it's convenient to buy another car, then ask the CU where to drop it off.

[despritfreya]

I signed a reaffirmation for the car, but the credit union didn't sign or return it because it didn't have the cross collateralization clause in it

How do you know the CU did not sign it? Since it was the CU who supplied you with the agreement you should assume it was signed by the CU. The question is, “was the Agreement filed with the Court”? You need to do the following:

1. Check PACER or go to the Court to find out if the agreement was FILED.
2. If it was filed you are probably stuck.
3. If it was not filed you need to RESCIND the agreement to be absolutely sure you are in the clear upon surrender. You send a letter (regular and certified) to the CU stating that you have rescinded the agreement. You might even want to file a copy of the letter with the Court. (Yes, your case may be closed, but you should still be able to file the letter.)

You need to be safe, not sorry. . . take the steps to ensure “safety”.

Des.

[jetsfan2010]

Good Luck