When To Avoid Debt Reaffirmation

A reaffirmation of debt is only a good idea when you get something out of it, like keeping a good car or the home you live in.   If you get a reaffirmation agreement for an unsecured debt, like a major credit card, it defeats the entire purpose of filing for bankruptcy. 

You went through the process in order to get a discharge of all your unsecured debt.  It wouldn’t make sense to reaffirm it.  This would make you once again responsible for that debt, a debt you were unable to pay and was your reason for filing in the first place.

It’s also probably not a good idea to sign a reaffirmation of debt on an old or unreliable vehicle.  If you are stuck driving a lemon, or even just a car that you don’t really like, chances are you would rather get a new one. 

Don’t sign a reaffirmation agreement in this case. 

You can simply allow this to be discharged like any debt under a Chapter 7 bankruptcy would be.  Of course you won’t be able to keep the car, you’ll have to give it back to the creditor.  Is that such a bad thing though?  Your debt on the car would be discharged and you would no longer be stuck with any kind of deficiency. 

Reaffirmation of debt is sometimes a good idea, but be sure to fully weigh the pros and cons before you sign anything.