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What Happens If I Fall Behind on Payments For A Debt Reaffirmed In Bankruptcy?

  • By: Christopher Benson
  • Published: December 3, 2014

When you reaffirm a debt in a Chapter 7 bankruptcy, you are waiving the right to have that debt discharged for the life of the debt. It means that not only are you agreeing to pay the debt. Therefore, if you don’t pay, you can be sued, property repossessed and any other remedies the creditor had prior to you filing bankruptcy in the first place.

When you file a Chapter 7 bankruptcy, you have a few choices concerning each debt. Some you may want to keep (aka “reaffirm”) and some you want to discharge.

For secured debt, if you don’t reaffirm the debt, then you have to surrender the collateral.

Normally when an individual falls behind on payments on something like a car or home, it can be repossessed or foreclosed on, and at that point you no longer have to make payments, because the lienholder has taken possession of the asset—it’s no longer yours. When you reaffirm a debt, however, when you fall behind on payments, the item is taken and you are required to fulfill your legal obligation for the debt anyway. So why would anyone want to reaffirm a debt?

The simple answer is that the debt follows the collateral. So, if you want to keep the property that is secured by the loan, then you have to reaffirm the debt. Also, if you have a low payment or owe very little on an asset, it may be worth it to reaffirm because the risk of default is very low. You may also want to reaffirm if a someone cosigned on your loan so they are not held legally responsible for the debt.

Over the past 27 years, the Law Offices of Christopher A. Benson has helped over 2,300 of Washington clients take control of their financial situation. We can stop your garnishment and change your monthly payments for all your combined unsecured debt, and if you have had more than $600 garnished within the last 90 days, we can get all of the money back in most cases. But you have to act quickly–call (253) 815-6940 for your free consultation, or email us today. Evening and weekend appointments available.

Christopher Benson

About the Author Chris served on the Board of Directors for Habitat for Humanity
Seattle/S. King County for 10 years and served as Vice President
of the organization during part of that time. Read More