Discharged and a couple of questions

[bejam]

[HHM]

Re: Verizon. At a minimum, you will be liable for any charges you incur post BK, including the regular monthly fee.

Re: Heloc. Did you happen to reaffirm the the HELOC. You do realize, that if you did not reaffirm, the HELOC has the right to foreclose on your property.

[wrinkleigh]

I would think you should have cancelled the Verizon and then included them in the Bankruptcy.

If you are still incurring charges -- you are liable for them/.

[bejam]

Thanks for the reply.
Re: Verizon, oh well, guess we should have cancelled it way back when... live and learn and keep using it I guess... Fortunately, the contract ends in April at which time we can cancel w/o penalty if we want to.

Re: HELOC. I guess I'm not clear as to what are the advantages of not reaffirming. We did not reaffirm but were told we can at any time. So why not? If we don't the account stays in their bankruptsy department and we never get a bill so we have to remember to send one every month, and, as you say, they can foreclose if we don't pay. But they can foreclose anyway if we don't pay because it is secured to our house debt so what is the difference there?

We are thinking it's time to sign the reaffirmation papers.

[HHM]

To my knowledge, you have to reaffirm before discharge.

What I meant by foreclosing anytime they want, is, if you don't reaffirm, they can foreclose, literally, anytime, regardless if you miss a payment because, under the new BK law (although this still needs to be tested in litigation to some degree) the failure to reaffirm is a sufficient default event. Thus, for example, lets say you did not reaffirm and 2 years from now, the value of the house goes up sufficient to to pay off both notes and provide you equity $20,000 equity. The second mortgage, looking to make some money could do this.
1. Buyout the first mortgage (at a slight discount).
2. Inititiate foreclosure, because you did not reaffirm.
3. Bid just enough to pay off the first and their second,
4. Turn around and sell the property on the open market and pocket your $20,000 equity as profit.

[lrprn]

HELOC. I guess I'm not clear as to what are the advantages of not reaffirming.

Our lawyer told us the advantage of NOT reaffirming under the new law is that if we run into financial trouble later when we can't file bankruptcy again, we will not owe whatever shortfall may come from a home foreclosure or car repossession. If we reaffirm, then we will have to pay the balance owed which could create a real hardship if we can't afford it.

Even though the new bk law states that you must reaffirm, redeem, or surrender secured loans, in reality most districts are finding that unless there is a sizeable profit involved for the lender to take back the asset (i.e. a house or car worth far more than its loan), lenders make much more money in the long run when they allow you to continue to make on-time payments for the life of the loan. As long as you make your payments on time, so far around the country, the majority of lenders are leaving things well enough alone.

Only you can decide if the risk is worth the gamble that your lender will be one of those that continues to allow you to pay on time and keep your asset. This webpage does a pretty good job of explaining both sides of reaffirmation under the new bk law - http://www.debt-relief-bankruptcy.co...ptcy-guide.asp