Reaffirmation Agreement

While filing for Chapter 7 bankruptcy in California, the debtor goes through a liquidation bankruptcy and tells the court they do not have the funds to pay back their unsecured debts. But what happens if the debtor wants to keep their vehicle or other secured debts they still owe money on? They file a Reaffirmation Agreement with the help of their attorney. The Law Office of Christopher Hewitt has been helping clients sign Reaffirmation agreements throughout their history in Riverside and Orange Counties.

What is a Reaffirmation Agreement?
A reaffirmation Agreement is a contract between the debtor and the creditor made outside of the bankruptcy. The debtor agrees to make payments directly to the creditor to keep or reaffirm the asset. By signing a Reaffirmation Agreement, the debtor now owns the asset outright. The debtor must make total payments until the debt is cleared on the asset. If the reaffirmed vehicle is involved in an accident, debtors must know they are still responsible for paying for it. Additionally, if the debtor defaults on the payments by the Reaffirmation Agreement, the creditor will repossess the asset.

Why do debtors choose Reaffirmation?
The most typical asset for a Chapter 7 debtor to Reaffirm is their vehicle. Almost everyone in America needs a car or truck to get back and forth to work and live in our society. After filing for bankruptcy, getting a new vehicle loan can be difficult and expensive. Reaffirming their current vehicle allows the debtor to keep the asset without facing any significant change in cost. In contrast, they might face higher APRs and insurance rates for a new vehicle.

What if I don’t Reaffirm?
As the debtor filing for bankruptcy, you can decide what assets you want to reaffirm and which assets you wish to return to the creditor. When Reaffirming an asset, you must be able to show your income will be enough to pay the asset. The creditor will usually send you a surrender letter that states that you are choosing to surrender the asset and the address where the creditor can pick up the surrendered asset or even garnish your wages to pay off the debt.

Who prepares a Reaffirmation Agreement?
The creditors who own the assets you are trying to reaffirm will create the initial Reaffirmation Agreement, and your attorney or their paralegal will fill out the remaining parts of the agreement according to your Chapter 7 Voluntary Petition. The Reaffirmation agreement lists your income and expenses, showing you can pay monthly payments without undue hardships. The creditor uses Official Form 427 to send to the debtor to confirm the reaffirmation of the asset in question. The court must approve reaffirmation agreements that a Riverside attorney did not represent.

Using an Attorney for Reaffirmation
We strongly recommend using an experienced bankruptcy attorney, contact us for more email. 
Client Reviews
I highly recommend Christopher Hewitt. Chris was doing pretty good job on my case with full support from processing, scheduling and other questions. We are in desperate situation facing foreclosure and credit card debt at that time, he saved us. He has my highest recommendation with regard to his expertise. Rizal H K
We found the law office of Christopher Hewitt to be a pleasant relationship in our legal situation. The law office was always responsive and always treated my questions as important and answered very quickly. The law office always advised me and I got great advise on our situation. I would highly recommend this law office for your legal dilemma. John H
Ibegan a business relationship with the Law Office of Christopher Hewitt and dealt with Mr. Hewitt directly. I utilized his service in debt management and because of him i am debt free within 6 months!!! I cannot thank him enough for all the hard work he did and how effective he was with all my creditors. I definitely could not have been this successful with eradicating my debt if i had not employed Mr. Hewitt's services. I strongly recommend him and his Law Office to anyone looking for legal help. Thank you so much!!! Debra B.
The Law Office of Chris Hewitt was great at handling my debt settlement. I was able to speak directly with the attorney multiple times and he always knew what was going on with my accounts and gave me clear advise. I did not feel like he made any false promises and was very realistic about what the outcomes would be. At the end of the year I was able to pay off all my credit cards at less than 40% of what I owed at the time I hired him. I would highly recommend Chris Hewitt for any one who has debt issues and does not want to file for bankruptcy. Karen H.
Basically, if I could describe my experience with Chris Hewitt in three words they would be, professional, straight-forward, and helpful. Going into filing chapter 7 bankruptcy, I had no clue where to begin. Chris took me where I was at and guided me along a process that proved to be clearing financially and emotionally. Plus, I am quite certain nobody could have done it for a better price. I would recommend his service to anybody. Thank you. Dylan H.