How would voluntary surrender of reaffirmed leased vehicle after Chapter 7 bankruptcy affect our credit? 12 Answers as of December 30, 2014

Hi, within the past year my spouse and I filed for chapter 7 bankruptcy, we reaffirmed our lease for our vehicle, and have been making necessary payments, we have one more year to go, but would like to get out of our lease. The loan company told us that we could do a voluntary surrender/repossession, what would this do to our already dinged up credit (from filing for bankruptcy). Any help is much appreciated!

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Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
Not only would it be a new hit on the credit would still owe the balance on the lease. Most likely the person you talked to has no idea this is what will happen.
Answer Applies to: California
Replied: 12/30/2014
Stephens Gourley & Bywater | David A. Stephens
It would damage your credit, but also if you reaffirmed the lease, you may be liable for the deficiency on the lease because that debt was not discharged.
Answer Applies to: Nevada
Replied: 12/30/2014
D.J. Rausa, Attorney at Law | D.J. Rausa
The vehicle lender can pursue you for any deficiency. Since you reaffirmed the debt, you are responsible for the balance owed on the lease. What your credit report looks like going forward is unknown.
Answer Applies to: California
Replied: 12/29/2014
A Fresh Start
A Fresh Start | Dorothy G Bunce
No matter what you hear from the lender, a voluntary surrender is the same as a repo. And because you signed a reaffirmation, the lender can sue you for the balance owed under the lease unless you have something from them in writing that they won?t sue you. All of this is very bad for your credit.
Answer Applies to: Nevada
Replied: 12/29/2014
GARCIA & GONZALES, P.C. | Richard N. Gonzales
Unfortunately, it would adversely be reflected on your credit report. You have to pick your poison.
Answer Applies to: Colorado
Replied: 12/29/2014
    Marc S. Stern
    Marc S. Stern | Marc S. Stern
    It will not help your credit. More importantly, since you reaffirmed the debt you are responsible for the lease payments. They can and will sue you for the deficiency.
    Answer Applies to: Washington
    Replied: 12/29/2014
    Law Offices of Daniel J Winter
    Law Offices of Daniel J Winter | Daniel J Winter
    Check with your bankruptcy attorney. If it is not too late, you might be able to cancel the reaffirmation agreement.
    Answer Applies to: Illinois
    Replied: 12/29/2014
    J.M. Cook, P.A. | J.M. Cook
    The cardinal sin of credit reports is bad performance after bankruptcy. It is not as much an affect on the score but on credit managers' decisions.
    Answer Applies to: North Carolina
    Replied: 12/29/2014
    Law Office of Michael Johnson
    Law Office of Michael Johnson | Michael Johnson
    If reaffirmed they could come after you for what is owed on deal.
    Answer Applies to: Florida
    Replied: 12/29/2014
    Stittleburg Law Office
    Stittleburg Law Office | Bernd Stittleburg
    A voluntary repossession of your leased vehicle would affect your credit rating, how much mathematically is unknown, but yes it would be affected. Additionally, since you reaffirmed the vehicle in the bankruptcy, if there is any deficiency on the contract after you surrender it, you would be responsible to pay that. The bankruptcy would not relieve you of that obligation.
    Answer Applies to: Georgia
    Replied: 12/29/2014
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    It will affect your credit just the way it did before and they will sue you for their losses on the vehicle.
    Answer Applies to: New York
    Replied: 12/29/2014
    Ryan Legal Services, Inc.
    Ryan Legal Services, Inc. | Kevin Ryan
    If you signed a Reaffirmation Agreement which was also approved by the U.S. Bankruptcy Court prior to the Discharge Order being issued ( you need to verify this ), then you would be liable to for the deficiency balance due on the lease after the leasing company sells the vehicle and applies any net proceeds to the contract payoff post-sale.
    Answer Applies to: Ohio
    Replied: 12/29/2014
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