Reafirming house and car

[LadyInTheRed]

My car falls under an exemption in Kansas. I very distinctly remember one attorney telling me I didn't have to include it and the last guy I saw didn't seem concerned about it either.

You are confusing two different issues. Exemptions have to do with whether the trustee can take an asset and liquidate it to pay your unsecured creditors. If you can exempt your equity in the car, the trustee can't take it. But, regardless of exemptions, the loan on the car must still be included as a debt in your bankruptcy. Not that it is anything to be concerned about, as long as the loan and the car are listed and your equity in the car exempted on the proper schedules of your BK petition.

[ohiogal]

Interestingly, I reaffirmed my car when I filed and the bank LOWERED my interest rate from 13% to 8%. Knocked $130 off the monthly payment. I was happy. :-) Especially since the bank was Wells Fargo, and they're generally pretty nasty to BKers...

[ksgirl38]

If the party that is blocking your online access is the lien-holder for your car note, you may have to reaffirm the car note to get the online access back. If that is the case, and you decide not to reaffirm, then your bank's bill pay is a good way to go. Just be sure that your checking account and the car loan are not both at the same institution.

They aren't. I have a 0% interest loan so I wasn't wanting to reaffirm so that they couldn't have an opportunity to change that.

[ksgirl38]

You were either given incorrect information or you misunderstood. All of your debts must be included in your bankruptcy, regardless of who the creditor is. If you owe them money, they get listed on your petition, receive notice of your BK and the debt is discharged unless you reaffirm or there is some exception to discharge (not likely for a car loan). The lender will still have a lien on the car if the debt is discharged, but you can usually keep paying without fear that the lender will repossess the car.

My car falls under an exemption in Kansas. I very distinctly remember one attorney telling me I didn't have to include it and the last guy I saw didn't seem concerned about it either.

[Drazil65]

All debts must be included, both our cars were current, never been late and we just continued to pay like normal (carmax and BOA neither of them shut off our access). To the OP, please be informed and absolutely do not "leave it to your attorney" for whatever reason. This is a very critical and life changing decision period. Not to be entered into without knowing everything you can possibly know and research. You must make decisions that only you can make based on your situation and the facts in your life, you owe it to yourself to be informed.

Please read everything you can about reaffirming BEFORE your pull that trigger. You can still stay and pay in your house and you can do the same for your car, the banks will gladly take your payments. You do not have any idea how the future will play out or if you will once again be in a situation at some point and cannot pay your mortgage, why would you take that debt on again. If you are filing then put yourself in the best position possible as the damage is done once you file, you are already there, you filed bankruptcy. You are a bankruptcy filer and the banks are not going to treat you any better the next time you get into trouble because you reaffirmed, actually the banks will love you upfront for taking all that debt and signing for it once again but then its business as usual and you are stuck.

Things happen, jobs come and go, medical issues happen or whatever got you here to begin with. Please reconsider until you at least do your homework and YOU make that decision. The best of luck to you.

[LadyInTheRed]

I was told that I didn't need to include my car in the BK since I'm current on all payments. It's financed through the manufacturer, does that make a difference?

You were either given incorrect information or you misunderstood. All of your debts must be included in your bankruptcy, regardless of who the creditor is. If you owe them money, they get listed on your petition, receive notice of your BK and the debt is discharged unless you reaffirm or there is some exception to discharge (not likely for a car loan). The lender will still have a lien on the car if the debt is discharged, but you can usually keep paying without fear that the lender will repossess the car.

[AngelinaCat]

I cannot speak regarding student loans, as we didn't have any when we filed.

However, we did (and still do) have a 2004 WV Jetta, that we still owed about 10-12 months on when we filed. We had to include that, even though we were current with the payments. It was financed through our CU, and 'Hub wished to remain with that CU, as he had done business with them for nearly 40 years. So we reaffirmed in order to do that. We also had our checking account with them.

We were a Ch7 case, and we had to list all of our debts. We were also warned that if we entered into any side agreements to pay a debt outside of the BK, that we would risk having our case dismissed.

[ksgirl38]

If the party that is blocking your online access is the lien-holder for your car note, you may have to reaffirm the car note to get the online access back. If that is the case, and you decide not to reaffirm, then your bank's bill pay is a good way to go. Just be sure that your checking account and the car loan are not both at the same institution.

I don't have any loans currently through my bank. I was told that the car wouldn't need to be included and would be separate since there are no late payments. Basically I was told it would be viewed the same as my student loans. Is this not correct?

[ksgirl38]

Not all lenders block online access, but many do. Using your bank's online bill pay is a good alternative to mailing a payment.

You must include all debts, including your car loan, in your BK. You can continue to make the payments, but the debt will still be included and will be discharged if it is not reaffirmed.

I was told that I didn't need to include my car in the BK since I'm current on all payments. It's financed through the manufacturer, does that make a difference?

[AngelinaCat]

If the party that is blocking your online access is the lien-holder for your car note, you may have to reaffirm the car note to get the online access back. If that is the case, and you decide not to reaffirm, then your bank's bill pay is a good way to go. Just be sure that your checking account and the car loan are not both at the same institution.

[LadyInTheRed]

I realize this is kind of off topic, but do all lenders block access once you file BK? I have a car loan which I'm not reaffirming and not including in the BK, but just wondering if I'm going to have to prepare to mail payments in from now on. I'm so used to doing all my transactions online that I'm just wondering if I'll have to change that.

Not all lenders block online access, but many do. Using your bank's online bill pay is a good alternative to mailing a payment.

You must include all debts, including your car loan, in your BK. You can continue to make the payments, but the debt will still be included and will be discharged if it is not reaffirmed.

[ksgirl38]

Most lenders block the online access (thru their own websites) because the information contained could be considered an attempt to collect a debt, which would violate the automatic stay. Using your bank's online bill pay is a different situation. Its customer initiated, so a purely voluntary payment. Should not have any issues.

Making voluntary payments is not the same as reaffirming though. Discuss in detail w/ your attorney if you intend to reaffirm.

I realize this is kind of off topic, but do all lenders block access once you file BK? I have a car loan which I'm not reaffirming and not including in the BK, but just wondering if I'm going to have to prepare to mail payments in from now on. I'm so used to doing all my transactions online that I'm just wondering if I'll have to change that.

[NoMoreCards]

You should never blindly follow your attorney's advice. You are your own best advocate and you need to understand the issues and be the one to make all final decisions. If she advised you to reaffirm your car loan and mortgage, you should ask her why and make sure you agree with her reasoning. You may be able to afford your home and car now. What if that changes later?

As AC can tell you, attorneys don't always give the best advice.

I can't agree more. When I filed, my attorney advised against reaffirmation and I wanted to keep my house. It took this site to help me understand why I should not reaffirm. Fast forward to today. I ended up intentionally letting my house go into foreclosure and purchasing a foreclosure for cash. I now have no house payment. Life happens. Don't strap yourself with this debt, because if you ever decide to leave due to "life happening" you CAN!! You don't have to, but the option remains as long as you DO NOT REAFFIRM. By reaffirming, you lose one of the best benefits to filing.

There have been many on this site who have reaffirmed, only to deeply regret that decision down the road. Please, please look into this and do not blindly take the advice of a attorney. Should something happen down the road, it is you who will pay the price of reaffirmation, not your attorney.

All the best to you

[LadyInTheRed]

I am leaving it in my attorney's hand to handle what is best. I figure she has a lot more experience than I do and knows what she is doing.

You should never blindly follow your attorney's advice. You are your own best advocate and you need to understand the issues and be the one to make all final decisions. If she advised you to reaffirm your car loan and mortgage, you should ask her why and make sure you agree with her reasoning. You may be able to afford your home and car now. What if that changes later?

As AC can tell you, attorneys don't always give the best advice.

[keepsmiling]

Please listen to the advice given here and do NOT reaffirm. Everyone here has your best interests at heart and had BTDT.