Reaffirmed - Second Thoughts

[Walnut]

We are less than three weeks from discharge and I have some dilemmas. I have two vehicles, both upside down each by about $6000. One we reaffirmed and now it has mechanical problems which could cost around $1000 to fix, the other is not reaffirmed - have heard nothing from the lender. I intend to stop paying on it and surrendering it. If we choose to rescind the reaffirmation, we will then have to surrender the other vehicle as well.

So, here's what I need to know from all y'all with experience:

1) When is the STAY lifted ? Closing or discharge?

2) If I stop paying, how long after discharge will it be before they come calling?

3) Same as #2, but pertains to rescinding the reaffirm agreement.

4) Can I get two vehicles (used ones obviously) right after discharge? I have to hope the credit reports all show correctly.

5) Is it better to stay with the reaffirm, bite the big one on the repairs, still be upside down, and yet keep a credit reference?

6) What would YOU do?

[FilingOnMyOwn]

Originally Posted by Walnut

6) What would YOU do?

I would definately let them both go. I'm not sure what you were thinking trying to keep them, if each one actually is upside down by $6000 each

[BKTango]

You do realize that if you stop paying on the vehicle you reaffirmed you are responsible for paying for it plus all late fees and charges? You cannot take back your reaffirmation agreement, it's there filed in the courts already. You will be held responsible to pay for this vehicle no matter what now. The only thing you could possibly do is try to sell it to pay it off, other than that you have to pay for it.

[JollyGG]

Originally Posted by BKTango

You do realize that if you stop paying on the vehicle you reaffirmed you are responsible for paying for it plus all late fees and charges? You cannot take back your reaffirmation agreement, it's there filed in the courts already. You will be held responsible to pay for this vehicle no matter what now. The only thing you could possibly do is try to sell it to pay it off, other than that you have to pay for it.

Actually that is not true. He has 60 days from the date the reaffirmation is filed or till discharge, whichever is later, to change his mind and rescind the reaffirmation agreement.

[almostthere]

I reaffirmed a vehicle although the payments were a bit high for me at $380 a month.

My attorney informed me that I was free to go ahead and buy a car (post 341) if I could lower the payments. I decided NOT to since

1) The few dealers that were willing to work with me wanted a large down payment and high interest rates.

2) Since I wanted to lower my payment to the $250 range, it limited vehicle selection drastically.

3) Tag and title fees

4) My current vehicle was only a little upside down and a very popular model so there is a possibility that what I owe will catch up with Blue Book value.

5) I have already paid 34/60 payments and it should help my credit score rating when I rebuild.

6) I have a good interest rate on the vehicle

I don't know if it's a good idea to reaffirm a vehicle that is upside down $6K.
If it were me, I would probably save this months payment and use it toward buying a temporary vehicle for $3k or something until I could afford something better. This way I still save $3K (possibly more if the vehicle in question needs repair) and have the option of just letting another debt go.

In order to be upside down $6K, I'm assuming that the vehicle is pretty expensive and your monthlys are pretty steep too?

[almostthere]

Originally Posted by JollyGG

Actually that is not true. He has 60 days from the date the reaffirmation is filed or till discharge, whichever is later, to change his mind and rescind the reaffirmation agreement.

That's what my attorney told me as well.

[BKTango]

Originally Posted by JollyGG

Actually that is not true. He has 60 days from the date the reaffirmation is filed or till discharge, whichever is later, to change his mind and rescind the reaffirmation agreement.

You are correct....and I read the OP incorrectly. There is a 60 day "grace" period so to speak. I read the OP to say "three months from discharge" which would put it at the tail end of the 60 day period from the discharge.

I think it's finally time to stop fighting the "I don't need glasses" fight.

[Walnut]

The vehicle in question is a 2001 Honda Odyssey EX, 92000 miles and I have added a DVD system to it. Terms of reaffirm are: $395.41/mo, 36 mos, 6.99% rate. We owe about $13K. With the DVD system it is probably about $4000 negative. If I get the items fixed on it, the condition will improve from Fair to Very Good. Finding a vehicle to haul everything around (family of five) with more or same cargo space is tough. We leased this vehicle for 4 years and flipped it to a finance in Jan 2005. We buried a lot of negative equity from a Dodge Caravan into the lease.

The unknown is what scares me. I don't know if I feel safe surrendering both cars and being stuck without. I hear good things about the Cap One BC but I need my car for work. Salary is $76000/yr and have held pretty much the same job for 15 years with two companies. We live in San Antonio, TX so my income is way above average.

[almostthere]

Tough call.....
According to the Kelly Blue Book, your vehicle is worth about $10K(private party sale). Being upside down for $4K is certainly better than $6K but still significant.

The interest rate you have is a lot better than what I would expect for myself anytime soon. The same loan at 18% would be $470 a month which would be about $2.7K more when you compare the total amount paid throughout the 36 month duration. So unless you are sure you can get financed in another van at 6.99%, keeping the $390/ month payment if you can afford it (looks like you can) MAY be something you might consider.

[Walnut]

Yeah and we are up against it. I have to decide by discharge (last day for objections is May 1). We are going to surrender our 2003 Mitsubishi Lancer and get something else. On that one, we have about 26 months left, plus have almost $2000 in late fees (but those might get washed away in the BK). Interest rate is 11.76%. No reaffirm was offered even though it was our original intent.

[Walnut]

Update - as if this could get any more unreal - we went camping (or attempted to) last night at Garner State Park in Texas. Last night, we were caught in a thunderstorm that dropped golfball to baseball sized hail and now the vehicle in question is dented everywhere. I filed a claim with GEICO, and may just pocket the damage check and rescind the reaffirm agreement and turn in the vehicle.

[almostthere]

Originally Posted by Walnut

Update - as if this could get any more unreal - we went camping (or attempted to) last night at Garner State Park in Texas. Last night, we were caught in a thunderstorm that dropped golfball to baseball sized hail and now the vehicle in question is dented everywhere. I filed a claim with GEICO, and may just pocket the damage check and rescind the reaffirm agreement and turn in the vehicle.

UNREAL..... wow !!

No injuries I hope.... I heard about the horrible storm.

[Walnut]

DW got a little banged up. And to make matters worse, while running an errand last night, the same vehicle got a flat tire. And, no - I am not kidding. Someone up there is trying to tell us something.

[Walnut]

We have sent our attorney the intention to rescind the reaffirmation agreement. We will surrender both vehicles and buy a new minivan using my mom as cosignor. Will rescinding the agreement result in means test recalculation??? Or does it even matter?