What Happens If I Don`t Sign A Reaffirmation Agreement

Following successful insolvency proceedings under Chapter 7, the claimant receives insolvency reorganization that removes the applicant`s personal obligation to repay certain debts. Although the custodian is no longer personally required to repay a secured debt, the loan is still associated with the property. A secured creditor retains its security right and right of redemption, but can only recover a deficit balance if the claimant confirms the debt by a new agreement. Reaffirmation agreements certified by the applicant`s insolvency lawyer are immediately binding and do not require consultation. Often, however, insolvency lawyers do not sign confirmatory agreements, especially if there is no equity in the vehicle.

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