Re-affirm...Re-affirm

[apie1]

What is the name of your state? IL

If you re-affirm a auto loan through old law chapter 7 no asset case, would that be wise to do? My cousin recieved a re-affirmation agreement for a auto that she has. She really needs the car to get to work. The payment on the vehicle is only $200.00 a month with only so much left to pay. My only concern is would something like that be a red flag? Meaning would a trustee find that suspicious that she could pay that car but can't pay her other bills? In another sense I guess in a trustee's eyes whatever they can do to make sure the creditor gets the money, it would be okay to re-affirm. Any thoughts would be helpful...

 

[Motherto6]

It depends on what the laws are regarding your cousin's state. Some states allow you to "keep" your home and a vehicle. Florida for instance does this.
Does your cousin live in the same state as you?

 

[bigun]

An auto loan is secured debt. Some districts require a formal reaffirmation agreement and some don't. Her lawyer will advise her where her district stands.
Most people come out of bk keeping the car if the equity is below the limit in there state.
Personally, I'd never reaffirm since she'll be on the hook for any deficiency balance should something happen and she can't afford the payments, But, she may not have that choice.

 

[Who's Liable?]

Remember, if she DOES NOT re-affirm the loan, she is under NO legal obligation to continue paying on it or to return it... The financing company or dealership takes over responsibility... Sometimes they refuse to pick up the car because the cost of doing so would be over what the vehicle is valued at...

 

[apie1]

Thanks for your input on this bigun, who's liable and motherto6. You guys have been very helpful throughout this situation, I greatly appreciate it...