Reaffirm or not to?

[so-beyond-broke]

Hello

I plan to file my bk Ch 7 no asset next week knock on wood. I am just waiting to get paid and pay my bills so that there's little to no money in the account the day I file what's left can be exempted.

Question:

When I make my car payment this month, I will owe about $2600 to the bank and the car is worth about 3100 (KBB) 3300 (Edmunds). So any equity in this car is covered by NY's $2400 motor vehicle exemption. Since I don't owe that much and will be done paying off the car by December (final payment due 2/07) should I bother to reaffirm? Can't I continue to make payments on the car without the fear of losing it? If I don't reaffirm then the bk will wipe out this debt, but then the bank will take the car. If they decide not to take the car and the debt is wiped out then any future payments I make will not show up on my CR's as a loan which was paid off. Paying off the loan in full would help to rebuild my credit after bk (as a positive trade line?)

Also while in bk doesn't all payments halt - pending the final outcome? Should I continue to pay the bank for the car. Or will they hold the money and not apply it to the remainder of my loan?

Thanks,

sbb

[SinkingFast]

While you are in the BK process itself, if you want to keep the car, you'd better keep making the payments as usual.

The Lender won't be able to bill you or contact you in any way due to the automatic stay that will be put in place at the time you file. So, before you file, you might want to contact the Lender and see what payment arrangements they want made prior to being able to talk to you about your loan for a while.

Get the new mailing address for payments.

Loans where the person is in BK are generally handled by a different dept than regular loans are. The people who handle loans of people in BK are specially trained so they won't break the law by saying the wrong things to you.

I don't know what to tell you about Reaffirm. That was changed by the New Law. Part of the abuse under the Old Law was people would reaffirm at the last possible moment, and then revoke the reaffirm within the 60 day time period, and after their BK was discharged. New Law you can't do that. You reaffirm, you're stuck with it. But I don't know how it will work if you don't reaffirm.

I'd guess if you plan to keep the car anyway, and you have so few payments left at this point, reaffirm would be the way to go. That's just thoughts for you. Not really advise, as I don't know for sure what to tell you.

[so-beyond-broke]

Hi Sinkingfast:

I have the payment coupon books from the very first time that the bank mailed them to me almost 5 years ago so I have the address, but I go into my local bank and pay it each month in person and have been for awhile. Why wait up to a week for it to reach 50 miles from my house and get processed when I can walk 3 blocks and pay in person with cash. I will continue to pay in person and keep the receipts the bank teller gives me so that there are no problems i.e. that I didn't pay while in Bk. Out of all of my payments to creditors this is the only one that I have made faithfully and would hate for that to not reflect on my CR when its paid off. I would like to say that I managed to pay one person off n full despite my BK.

Thanks for the advice,

sbb

While you are in the BK process itself, if you want to keep the car, you'd better keep making the payments as usual.

The Lender won't be able to bill you or contact you in any way due to the automatic stay that will be put in place at the time you file. So, before you file, you might want to contact the Lender and see what payment arrangements they want made prior to being able to talk to you about your loan for a while.

Get the new mailing address for payments.

Loans where the person is in BK are generally handled by a different dept than regular loans are. The people who handle loans of people in BK are specially trained so they won't break the law by saying the wrong things to you.

I don't know what to tell you about Reaffirm. That was changed by the New Law. Part of the abuse under the Old Law was people would reaffirm at the last possible moment, and then revoke the reaffirm within the 60 day time period, and after their BK was discharged. New Law you can't do that. You reaffirm, you're stuck with it. But I don't know how it will work if you don't reaffirm.

I'd guess if you plan to keep the car anyway, and you have so few payments left at this point, reaffirm would be the way to go. That's just thoughts for you. Not really advise, as I don't know for sure what to tell you.

[Roadrunner]

I believe under new laws, reaffirmation is required. Not sure of the details though. If you do want to keep the vehicle, you will need to keep the payments up during your bankruptcy case. They won't be able to ask for them, but they can get the court's permission to repossess if you don't pay as agreed.

[annikasaunt]

I filed 2 weeks ago and my 341 meeting is 4/21. At the time I thought I had 2 payments left on my car loan, turns out the last one is due this week for almost double the original payment amount because of a skipped payment a few years ago. The bank offered it around the holidays one year, not an intentionally skipped payment. So, I'm mailing the payment tomorrow and the car will be PAID!! Do I need to do anything else regarding the BK? I'm sure they have been notified that I filed because at the time I did owe them money. I had it in my petition that I would continue to pay and keep the car. The value of it is exempt in my case.