Should I reaffirm my loan or not? 19 Answers as of November 07, 2014

I filed bankruptcy 4 years ago and did not reaffirm my mortgage with Wells Fargo nor my home equity loan with Chase. I am current with both loans but when I called wells Fargo to try and refinance, they said that they could not talk to me. What are my options if I do not reaffirm or if I do? Would it be in my best interest to reaffirm or not? We are thinking of downsizing so how does the payoff work?

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Law Office of Susan G. Taylor
Law Office of Susan G. Taylor | Susan G. Taylor
You can't reaffirm at this point.
Answer Applies to: Texas
Replied: 11/7/2014
Freeman Law Group, LLC
Freeman Law Group, LLC | Derek Freeman
Generally there is not much to benefit by reaffirming a loan. A reaffirmation agreement protects the creditor, not the debtor. If you sign a reaffirmation agreement, then if you can't make payments later on down the road and you go into foreclosure, the lender can sue you for the deficiency. If you don't sign a reaffirmation agreement, the lender can't sue you for the deficiency because the loan will be covered by the bankruptcy. As for your lender not talking with you, are you still in a bankruptcy? Are you in a chapter 13 plan? If so, the lender can't communicate with you because of the automatic stay.
Answer Applies to: Colorado
Replied: 11/6/2014
GARCIA & GONZALES, P.C.
GARCIA & GONZALES, P.C. | Richard N. Gonzales
Do not reaffirm.
Answer Applies to: Colorado
Replied: 11/4/2014
EDWARD P RUSSELL | EDWARD P RUSSELL
It is too late to reaffirm those debts. If the bank will not refinance you must to that elsewhere.
Answer Applies to: Minnesota
Replied: 11/3/2014
Ronald K. Nims LLC | Ronald K. Nims
The option to reaffirm a debt ends when the bankruptcy case is closed. I assume that a Chapter 7 filed four years ago has been long closed, therefore, you can't reaffirm at this late date. Well Fargo can't talk to you because it violates the discharge injunction, none of your discharged lenders are allowed to make any attempt to collect the debt. To avoid running afoul of this law, most lenders prohibit any communications with discharged debtors. Well Fargo can't refinance your loan because there is provision in the bankruptcy law which prohibits changes in loan contracts that have been discharged, If you want to refinance, you could move the bankruptcy court to allow Wells to negotiate with you and to amend its loan contract but that will be expensive and time consuming - particularly since you don't even know if Wells is willing to allow a loan modification. OR you could go to another lender - other mortgage lenders are subject to the laws which prevent Wells from negotiating with you.
Answer Applies to: Ohio
Replied: 11/3/2014
    Mauritz Van Niekerk, Attorneys at Law
    Mauritz Van Niekerk, Attorneys at Law | Christiaan van Niekerk
    I do not suggest you reaffirm your mortgage.
    Answer Applies to: New York
    Replied: 11/3/2014
    Tokarska Law Center
    Tokarska Law Center | Kathryn U. Tokarska
    Reaffirming a mortgage can only be done within a specific time frame after the bankruptcy case is filed and before it closes. BUT, it is not a good idea to reaffirm a mortgage and I've never recommended it or done it for any of my clients, although if they insist on it I will do as they wish after they sign a disclaimer that they have been advised against it. As far as refinancing, what the new prospective lender would need is a statement from the current lender showing a payment history. Not reaffirming means that the payment history is no longer being reported to the credit bureau. In lieu of that a statement from the lender showing payments should suffice. You can obtain this by contacting the current lender and asking them to send you a statement of activities since the date you filed your bankruptcy. You can then take that statement to the mortgage broker or whoever you are working with to get a new mortgage.
    Answer Applies to: California
    Replied: 11/3/2014
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    You would have to reopen your case to reaffirm and there are very few judges that would approve that anyway. Reaffirmation makes you personally liable for that debt again so judges don't like approving them. I would suggest going to a different bank to refinance, not Wells Fargo.
    Answer Applies to: New York
    Replied: 11/3/2014
    Deborah F Bowinski, Attorney & Counselor at Law | Debby Bowinski
    You cannot reaffirm your loan at this point in time. And it was probably the right choice not to reaffirm while your bankruptcy case was pending, in spite of what the grunts at Wells Fargo may be telling you now. They are not lawyers, nor do they have your best interest in mind. If Wells Fargo will not refinance, try to find another lender to do the deal. If you choose to downsize then the payoff works the very same way it always does. If there is enough value in your home to pay off the loans in full at closing then you are free to sell. If the value is not there you are left with either trying to put together a short sale or walking away from the property knowing that both mortgages were discharged in your bankruptcy.
    Answer Applies to: Colorado
    Replied: 11/3/2014
    Rhymer Law Firm
    Rhymer Law Firm | William Rhymer
    Most courts will not let you reaffirm a debt once the case has been discharged. You can refinance it through another bank. If you did not reaffirm on the 1st and 2nd mortgage, you can usually walk away from the house and not have to pay any money to the mortgage companies. However, I would suggest you contact your bankruptcy attorney and discuss it with him or her and then decide what you want to do.
    Answer Applies to: Georgia
    Replied: 11/3/2014
    Eranthe Law Firm
    Eranthe Law Firm | Cate Eranthe
    I'd suggest talking with a different lender. It's not that WF can't talk to you but has a policy not to. You can ask for proof of loan payments and submit that to the credit bureaus and or with a loan application to someone else. Some disagree but in my opinion it is not necessary or recommended to reaffirm a mortgage debt. Why would you give up a benefit of filing bankruptcy to please a lender?
    Answer Applies to: California
    Replied: 11/3/2014
    Stittleburg Law Office
    Stittleburg Law Office | Bernd Stittleburg
    Reaffirmation of a loan must be done within 60 days of the 341 Meeting of Creditors. If it has been 4 years, you cannot reaffirm the debt.
    Answer Applies to: Georgia
    Replied: 10/31/2014
    Law Office of Marlin Branstetter
    Law Office of Marlin Branstetter | Marlin Branstetter
    It is not a good idea to re-affirm. Contact other lenders about re-finance. You are entitled to a payment history from Wells Fargo. You can use that to establish your payment history with another lender.
    Answer Applies to: California
    Replied: 10/31/2014
    Danville Law Group | Scott Jordan
    It too late to reaffirm now. If you want to refinance, go to a different lender. As for payoff, Wells will always take your money.
    Answer Applies to: California
    Replied: 10/31/2014
    Southern Michigan Bankruptcy Center | Craig Jackson
    I would try to refinance with a different lender. If not, you could attempt to file a motion to reopen your bankruptcy case and file a reaffirmation agreement. Bear in mind that you would become personally liable again on the loan.
    Answer Applies to: Michigan
    Replied: 10/31/2014
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    Once you receive your bankruptcy discharge, it is too late to reaffirm. But reaffirming a mortgage debt is nearly always a bad idea because if your property is foreclosed on & sells for less than you owe, you are legally responsible for any difference if you reaffirmed. So not a good idea. Instead of trying to refinance with your lender, why not apply for a loan modification instead? Or go to another lender if you really want to refinance. The disingenuous people at your mortgage company who are telling you to reaffirm in order to refinance are telling you to fly without wings. In short, they are saying they will not refinance your loan under any circumstance.
    Answer Applies to: Nevada
    Replied: 10/31/2014
    Law Office of J. Thomas Black, P.C.
    Law Office of J. Thomas Black, P.C. | J. Thomas Black
    Reaffirmation Agreements must be entered into before the discharge in order to be valid, so it is too late to reaffirm the loan(s) now. They are likely not talking to you because your personal liability for the loans was discharged (in Texas, you don't have personal liability for home equity loans), and they are concerned that you will sue them for violating the discharge order, by trying to collect a discharged debt. I would try communicating with them in writing about your loans. You can send mail to the correspondence address. Alternatively, you could have your bankruptcy lawyer or another attorney that you hire communicate with them. You can also request payoffs in writing.
    Answer Applies to: Texas
    Replied: 10/31/2014
    Law Offices of Daniel J Winter
    Law Offices of Daniel J Winter | Daniel J Winter
    It's too late to reaffirm if you filed Chapter 7 4 years ago. Your bankruptcy case is over. It is not required or advisable to reaffirm a mortgage. Go to a different lender who may not have that requirement, and show your payment history to them.
    Answer Applies to: Illinois
    Replied: 10/31/2014
    D.J. Rausa, Attorney at Law | D.J. Rausa
    Reaffirmation agreements are only processed in a Chapter 7. So if you are now discharged in a Chapter 7, you cannot file a reaffirmation agreement. Further, it is doubtful that the Bankruptcy Court would sign off on one anyway. Ask the bank what information is needed for you to be able to speak with them. If your case is closed, then there should not be any problem. Consult with the attorney you hired to file your case, if applicable.
    Answer Applies to: California
    Replied: 10/31/2014
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