Reaffirmation Question

[Crazy]

Hello to all,

My husband and I have 2 vehicles & a Camper financed on ONE loan...the is set up like a LINE OF CREDIT. Example: We borrowed 1000.00 dollars and used our vehicles & camper as collateral, however if we made a monthly payment of $120, and $100 went to pricipal and $20 went to Interest, our loan balance would be 900.00 and we would have $100 available to draw off of and transfer to say checking if we needed it.

Ok, my question is, we are re-affirming this loan...however, we are changing it from a LINE OF CREDIT...to a regular loan. Our Banker has no problem doing this and will re-affirm at about the same payment each month. We filed 10-14 and 341 meeting is 12-13. Our next payment due on the LINE OF CREDIT would have been 11-2, however our banker is re-doing the loan as of tomorrow and so our first payment will be around 11-26. Is this the right thing to to...RE-AFFIRM and start making payments before 341 meeting?

THANKS IN ADVANCE FOR THE HELP,

Crazy

[Crazy]

BUMP..anyone know the answer to this??? THANKS...SO MUCH


Crazy

[Sondance]

I'm not an attorney, but hey, I slept in a Holiday Inn Express last nite, so I'll take a shot...

If your reaffirming something, your agreeing to continue to make payments on whatever that item is... unless of course your attempting to re-negotiate the balance and pay something less...

In your situation, if the bank financing happens before that payment is due, then your next payment and such should be accounted for in the new loan. If it's not, then you should still make that payment, and the bank financing should take that into account, when they "payoff" that loan.

Bottom line, if your intentions are to reaffirm then I would suggest you continue payments, and by all means insure you sign a "Reaffirmation agreement" with the creditor, as that will be a source of good credit on your bureau after the BK is discharged...

[StaciMM]

2 things to seriously consider...

Your reaffirmation must be approved by the trustee (the lender will need to file your reaffirmation with the BK court and they'll schedule a hearing-at that hearing you'll have to explain why the reaffirmation is in your best interest).

If you intend to keep them, you should keep paying. BUT considering the fact that you're trying to reaffirm paying $57,000 PLUS interest for property that is worth $30,000 it is very likely that your trustee will VETO your plan. Any payments you have made to the lender before it gets thrown out will not be refunded to you.

Something to think about (not necessarily to explain here) is why do you want to do this? You are in a financial bind now because of past decisions, and granted some things that were beyond your control. BK is a 'fresh start' and you won't have another shot at it for 8 years. Make the most of it this time and DON'T saddle yourself with a bad debt.

[Sondance]

Good point...

One thing I'll add...

I didn't have to reaffirm or should I say sign a reaffirmation with my first mortgage, so none of that went through the courts. In FL, it's not necessary to file anything through the courts... curiously my 2nd mortgage and vehicle loan did, I just missed it...

However, now that I'm a bit smarter, I am asking and continuing to follow up with my first mortgage to get one, will hopefully see by sometime next week. Reason being, that without one, they will not properly report that I've made all the payments and I'm current... which is IMPORTANT following my discharge. With a reaffirm it will show payments on time and account current, without it will show nada... they stop reporting and the debt shows as included in bk... not good!

Hence, why I suggested you insure that you get a reaffirmation with any creditor that you intend to continue to make payments with... I was lazy and my attorney did not tell me to do so...

Good luckL...

Rob