What does "Pay Through" mean?

[bear30044]

What does 'Pay through" mean as opposed to reaffirming your debt?

[AngelinaCat]

'Pay Through', sometimes called a 'Ride Through' means that you keep making your payments, and on time, without reaffirming the loan. Some institutions will let you do that, others won't.

The benefit is that if later on down the line, something happens that you can't make the payments, you won't be held accountable for any difference left, like you would be if you reaffirm the loan.

[bear30044]

Im still lost, I do not mean to sound stupid, this is all new to me...does pay through mean you just keep making payments to the bank you have the loan through? and if you reaffirm?

[WoodSprite]

Im still lost, I do not mean to sound stupid, this is all new to me...does pay through mean you just keep making payments to the bank you have the loan through? and if you reaffirm?

That's right. And if you reaffirm, you just keep making payments to the bank you have the loan through. No, you're not stupid (or seeing double), it's really confusingly similar.

A reaffirmation agreement puts you under a legal obligation to repay an otherwise dischargeable debt. If you default on the payments required under the reaffirmation agreement, the creditor can repossess or foreclose on the property and seek a personal judgment against you.

In order for a reaffirmation to be valid, the parties must sign the agreement and file it with the court before you receive a discharge. Also the court must determine that the agreement doesn't impose an undue hardship - i.e. that you can afford to make the payments.

I guess there's a lot of controversy about whether or not BAPCPA (the 2005 "new bankruptcy law") has eliminated this, but I have to admit that gets a bit beyond me...