Expert: Terry Leeders - 11/10/2008

Question
Hello, we (My husband and I )filed for bk in Stanislaus county and received a discharge in Mid August 2008.  When received our discharge notice, I was sort of confused that there was never any word on our reaffirmation of our vehicle.  I called the attorney (spoke to the paralegals, who switched hands many times during my case)and they said they showed that it was to be reaffirmed but they never received any word from Capital One Auto Finance.  I then contacted the company capital one had assigned our account to while in BK...After waiting 3 days for someone to call me back the representative said they sent a full packet to my attorney and they never received anything back...So now since my case has been discharged I need to wait for it to go back to Capital One and try to renegotiate with them or come to the table with what I currently owe in rears (at that time it was about 1600).  When I contacted my attorneys office the paralegal said that there was nothing they could do except for an amendment to my case, pay them to file it and return my car and wait for another discharge.  Well, I really can't return the car because if my husband does not have a van he can not work. We owe 8000 and the car and it is worth 4500, due to the high miles and a few mechanical problems with it.  We have not heard from capital one or a collection company and now we are in mid Nov...I have not made any payments and not really sure of what we should do...I have about 5000 I could pull out of a 401K to either purchase a vehicle or negotiate with capital one.  But one question I have is can I pull out the money and purchase another vehicle all while I am reopening my BK and waiting for another discharge?  I really am in need of guidance and don't really feel like I can depend on the attorney/or his office staff to guide me correctly...I don't want to hide and I really want us to have a fresh start.  Thank you for any assistance you can give....  

Answer
At this point you need to work with Capital one on getting the vehicle refinanced, as the debt is technically discharged in the case.  Most cases, the creditor should work with you, but it is not a guarantee.  Normally, reaffirmations need to be filed while the case is open.  Reaffirmations are not required though, and I usually do not recommend a reaffirmation for my clients if they are in arrears on the payments.  Work with your attorney, perhaps they can broker the deal with capital one to facilitate the new loan agreement.