Expert: Terry Leeders - 4/25/2008

Question
Hi. My wife and I files pro-say Chapter 7 in 04. It was discharged in 05. Ive been having trouble with my mortgage co.(Chase), as they say they never received a re-aff agreement. On my bankruptcy paperwork, in the schedule c, it says that we exempted the house, and that it was recognized as exempt by the court. The court doesn't have this re-aff paperwork in the docket. Now that the case is closed, can we still file a re-aff paper to the court as an amendment? Help,please. Ive been making payments all this time and have contacted my bank many times to question this matter, only to have recently received this bad news. We live in OH. What can I do? I am willing to hire an atty, but i need to know if they'll be able to do anything first as we are not "out of the hole" so to speak. Thank you for answering all of our questions.

Answer
Reaffirmations have to be entered while the case is open.  Theoretically, it is possible to reopen the case to enter the reaffirmation, this will cost 250-300 for the court fee. Then you have to bring a motion to reopen the case to enter it. Then it is up to the creditor if they want to honor it.  It would also be up to the court if they will let you reopen the case just to submit a reaffirmation 3 years later.

You technically don't need a reaffirmation, if you are current, and stay current, you will be fine.  If you refinance, then the loan is re-written, and you will then get credit on your credit report for timely payments. If you are behind, then, technically you are not on the hook for any more payments and can walk away, let them foreclose, and the balance of the debt is discharged thru your case.

So, your best bet is usually to just refinance in my opinion.