Reaffirmation Agreement
Many people who file for a chapter 7 bankruptcies are not familiar with what a reaffirmation agreement is and what it does. The reaffirmation agreement is signed by the Debtor and the creditor and in most cases it is on a debt that is secured, such as a house or a car note. The purpose of the reaffirmation agreement is to let the creditor know that you are going to continue making payments to them and if you do not, they have the right to reposes it and hold you responsible for any balance that it left over. The positive aspects of a reaffirmation agreement is the creditor is to mail you statements reminding you of the payment to be made and they also resume reporting the each of the credit bureaus. When they do this, it will show that you are current and on time, so when you are ready to refinance you will not have any problems refinancing it. Without the reaffirmation agreement, you can continue to make payments, but they will not send you statements and they will not report to the credit bureaus. This has caused many people problems when it comes to refinancing. Any questions or concerns you may have, contact your attorney’s office as soon as possible to see if the reaffirmation is right for you.
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