How do I reaffirm payments after filing for bankruptcy? 21 Answers as of February 23, 2012

Reaffirmation is a tool debtors can use to keep assets they want after bankruptcy. For example, if you want to keep your car that is secured you can work out a reaffirmation agreement with the lender to continue making payments and keep your car from being repossessed. It is not something you "have" to do but an option you can consider.

The only debts that you should consider reaffirming are "secured" debts. (eg. car loans, home loan etc.) You do not want to reaffirm any unsecured debts as these these debts (eg credit cards, medical bills, personal loans etc.) should be discharged. Even if you have secured debt and the bank is requesting that you reaffirm the debt it is best if you can avoid ay reaffirmation of debt. What I usually do is call the lender and see if it is ok that you do not reaffirm.

This is done with a reaffirmation agreement that must be filed and approved by the Court.

You need not reaffirm any debts unless you choose do do so voluntarily. There are some debts you may want to reaffirm. An example would be if you have a car that has a remaining balance due. The balance due can be discharged in bankruptcy, but not the lien on the car. The bank can repossess the car if you do not pay the balance. So if you want to keep the car, the bank may ask you to reaffirm the balance due and the payment terms under the original contract.

A reaffirmation agreement should be completed, signed and filed for secured creditors that you intend to keep the collateral. If you are surrendering collateral, the balance owed will be discharged and therefore, no reaffirmation agreement needs to be filed. The most common circumstance is for vehicle.

You would only reaffirm secured debt, most likelyhouse and/or cars. You might choose NOT to reaffirm anything. Reaffirmation is a post-petition promise to remain personally liable on the debt.

You only reaffirm "secured" debts you agreed to keep despite filing for bankruptcy. For example, you reaffirm the debt on an automobile or a home that you agreed to continue to pay. Debts that were discharged are already gone and there is nothing else to do with those. The lender usually sends you the paperwork for the reaffirmation.

You would need to sign a reaffirmation agreement with either your mortgage lender, or the lender on your automobile if you want to retain those assets in a Chapter 7 case. If you plan on surrendering your automobile or your home, you would not reaffirm these debts.

Reaffirmation of debts is discouraged.The only debts that should be affirmed are secured debts when you want to retain the asset. Reaffirmation agreements are generally limited to your home and your auto. If you want to keep them you have to keep up the payments; and the creditor generally wants the agreement signed and approved by the court. There are occasions when you want to keep your creditor happy. For instance, money owed to the family doctor; or money owed to a close family member. In these cases you notify the creditor that notwithstanding the bankruptcy you will continue making payments. Rarely will there be a formal reaffirmation agreement in these instances.

You would need to reaffirm auto financing or any other financing that is secured by collateral because bankruptcy does not prevent a secured creditor from taking action to retrieve the collateral for non-payment.