Re-affirmation agreement--State of Washington, court denied the affirmation agreement

[John Donovan]

What is the name of your state? Washington. The court denied an affirmation agreement that was petitioned to the court. The reason given was: (a) the reaffirmatioin agreement is not in the best interest of the debtor, (b) and will impose an undue hardship on the debtor(s). I need to know what this does to the automobile in question. I exempted the automobile in the amount of $8,300.00, and the value was $8,500.00. What is the legal ramification? Does this discharge the lien. amd make the property not of the estate?

 

[Ladynred]

BK courts don't really like reaffirmation agreements, as you've found out. They're typical, but not always granted either. The thing is, if you include the car in your BK, it will be discharged. As long as you keep making payments and stay current, you can generally keep it, the bank doesn't really want it back. If you find later that you can't afford to keep making the payments, you walk away from it and you will have NO liability for any deficiency when its sold at auction.

 

[dorenephilpot]

The court denied your reaffirmation because it determined, for reasons unknown to us, that this was a bad idea for you -- probably the monthly payments were going to take too much of your income.

Downsize to a smaller, cheaper car is the message from the court.

 

[hkolln]

Same thing happened to me in my chp 7 in 1992...Reason given was this:

With the reaffirmation agreement: if we defaulted the bank could take the vehicle PLUS sue us for the balance.
Without the reaffirmation: if we defaulted the bank could take the vehicle but NOT sue us for the balance.

Therefore he was protecting us which made sense. We then after the chp 7 was finalized got with the bank and agreed to pay the loan as due and keep the vehicle. They reported it on our credit as a regular account...paid as agreed. They did not report it as included in bankruptcy. It was like we never included it in our bankruptcy paperwork.


We just got with our bank (bank of america) and continued to make our scheduled payments as before and kept the vehicle. Once it was paid off we obtained title. They continued to report our auto loan as "paid as agreed" and not included in bankruptcy like our other debts. If I were you, I would contact the legal dept of the bank or whomever handles the reaffirmation agreements and tell them you want to keep the vehicle and just continue to pay on it. Most likely they won't want it back cause it's not worth anything to them...and you both win if you keep it.

Good luck!