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The thought of losing your property after filing for bankruptcy can be heartbreaking. Fortunately, Chapter 7 bankruptcy in Raleigh, NC has several tools that can help you keep some of your most important assets. One of these is reaffirming debt.
Reaffirming Debt in Chapter 7
Essentially, Chapter 7 bankruptcy gets rid of debt by discharging your unsecured liability with creditors. You don’t have to pay them anymore, and they can’t take legal action against you.
In the case of secured debt, which is debt that is secured by collateral such as a car. Creditors can also repossess the property as part of your debt settlement if you don’t state that you want to keep the collateral.
If you want to keep the collateral, you can reaffirm that debt instead.
This means that you agree to keep paying it even though you’re filing for bankruptcy, and in exchange, creditors won’t repossess the property.
However, the process is more complicated than that – which is why we recommend consulting with Attorney Weik before you may any decision about your Chapter 7 bankruptcy filing.
Which Debts Can Be Reaffirmed Under Chapter 7?
It’s important to note that not all assets are eligible for reaffirmation. You can only reaffirm secured debts, such as a car loan, and not unsecured debts, like credit card debt.
They should also be essential to your day to day living. A basic car is usually okay, but luxury items like yachts, holiday homes, and expensive jewelry are generally not eligible for reaffirmation.
You Only Have a Limited Time to File the Agreement
If you choose to reaffirm debt, you must act quickly – the court only allows a small window of time for you to file the agreement before it discharges the debt.
In addition, the process of reaffirming debt is complicated. You want to make sure you fully understand the ramifications before signing, so it’s best to speak with a bankruptcy attorney in Raleigh, NC who can help you decide whether this is the right option for you.
Creditors Can Reject a Reaffirmation Agreement
Making things more complicated is the fact that creditors have the power to reject a reaffirmation agreement.
The key here is to have an experienced bankruptcy attorney review the reaffirmation agreement, then advise you on how to best move forward.
Explore Your Bankruptcy Options Today
Reaffirmation agreements are just one of the many ways Attorney Weik can help you use Chapter 7 bankruptcy in Raleigh, NC to regain financial freedom.
Depending on your situation, Attorney Weik can also help you protect your savings accounts, stop wage garnishment, and more.
Call Weik Law Office today at 919-845-7721 for a free consultation, and set up a time to speak with one of our friendly professionals.