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how to create the agreement

Posted on: 14th Nov, 2006 02:14 pm
how a reaffirmation agreement can be created at the time of bankruptcy and how it can be canceled
Hi Erskine,

You will have to sign and file the reaffirmation agreement with the court. These types of agreements are under special rules and are voluntary. They are not required by bankruptcy law and it is upon you to decide about such an agreement.

As per rules reaffirmation agreements:
  1. Must be voluntary;
  2. Must not place too heavy a burden on you or your family;
  3. Must be in your best interest.
Also if you are an individual and are not represented by an attorney, then the court holds a hearing to decide whether to approve the reaffirmation agreement. The agreement is not legally binding until the court approves it.

The other question you have asked:"how it can be canceled"
The reaffirmation agreement can be canceled anytime before the court issues your discharge or within 60 days after the agreement is filed with the court, whichever gives you the most time.

Thanks
Colin
Posted on: 14th Nov, 2006 02:30 pm
Thanks Colin for the information, kindly let me know what may happen if I reaffirm a debt and then fail to pay. Thanks again for your help
Posted on: 14th Nov, 2006 02:37 pm
Hi Erskine,

Let me tell you what action the creditor can take if you reaffirm any debt and afterwards fail to pay it. In such a case, you owe the debt the same as though there was no bankruptcy.

The debt that is reaffirmed will not be discharged and the creditor can take action to recover the property on which the debt has a lien. The creditor can also take legal action to recover a judgment against you.

Let us know if you have any other questions.

Thanks
Blue
Posted on: 14th Nov, 2006 02:44 pm
Thanks again Colin and Blue the information both of you have provided is really very helpful.
Posted on: 14th Nov, 2006 03:08 pm
Hi Erskine,

Reaffirmation agreement is a contract between you and the creditor that you will pay all or a part of the debt owed even if you have filed bankruptcy. The creditor allows you to keep the property after bankruptcy and promises not to repossess the property as long as all payments are made.

Prior to signing such an agreement, verify with the attorney as to whether your rights are protected. It's better to take help from an attorney who will assist you in the bankruptcy case. Otherwise, the bankruptcy judge will approve the agreement.

The judge will ask questions to find out whether the agreement creates a burden on you or your dependants. As reaffirmed debts are not discharged, the bankruptcy court will only reaffirm secured debts where the collateral is important to carry out daily activities. Reaffirmation agreements are voluntary and do not come under the Bankruptcy Code or any other state or Federal law.

Thanks,

Caron.
Posted on: 14th Nov, 2006 10:28 pm
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