Here is what I read about reafirming
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Posted by Problems in Texas
(24.28.125.170) on June 01, 2004 at 18:19:25:
In Reply to: Re: more questions on debt and BK - sorry but it is long posted by JerNTN on June 01, 2004 at 17:47:30:
On one of my previous posts someone suggested the Weber Law web site for me to read so I could better understand the process. Here is what that web site said about reafirming: 4.3 Reaffirmation Agreements. 4.3.1 Generally. For home and vehicle loans, a debtor that wants to keep the property may be required to sign a "reaffirmation agreement." A "reaffirmation agreement" is a contract which waives the bankruptcy discharge with respect to a particular debt. A debtor that signs a reaffirmation agreement must continue making the contract payments and will remain personally liable on the reaffirmed debt if he fails to pay. The reaffirmed debt will be completely unaffected by the bankruptcy filing, and will survive the bankruptcy discharge, as if the bankruptcy had never been filed. Unsecured creditors will often solicit a debtor to reaffirm all or a portion of an unsecured debt by offering to extend additional post bankruptcy credit. The unsecured creditor will usually try to sell the reaffirmation agreement by arguing that the additional credit will help the debtor to reestablish a positive post bankruptcy credit history and minimize the adverse impact of the bankruptcy on the debtor’s credit report. It is almost never a good idea for a debtor to reaffirm a completely unsecured debt. Almost all debtors will have numerous sources for obtaining post petition credit, and can reestablish a positive post bankruptcy credit history, without agreeing to pay any portion of the prior debt.
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