Can I Be Required To Reaffirm Debt After Bankruptcy?
In some bankruptcy cases, a debtor might choose to reaffirm one or more debts, which will mean that the debtor will still be responsible for paying those debts once the bankruptcy case has been finalized. Most often, a debtor will reaffirm debt in circumstances where a particular debt has a co-signer and the debtor does not want the co-signer to be accountable for the debt following a bankruptcy discharge, or in circumstances where a debtor wants to keep secured property after the bankruptcy case and therefore reaffirms the debt. Yet after a bankruptcy case (and a discharge), a debtor may be contacted by a debtor and asked to reaffirm a debt.
It is essential to understand that debtors cannot require you—and cannot even ask you—to reaffirm debt that has been discharged in bankruptcy. Our West Palm Beach bankruptcy lawyers can clarify.
When a Debtor Reaffirms Debt, That Decision is Made Before the Bankruptcy Discharge
Debt that is reaffirmed is not done after a bankruptcy discharge, but prior to the discharge. If a debtor wants to reaffirm debt, the debtor will need to enter into a reaffirmation agreement. In a reaffirmation agreement, a debtor acknowledges that the debt would otherwise be dischargeable in the bankruptcy case, and by signing the agreement, the debtor is saying that they will be responsible for the debt after the bankruptcy case. In other words, the debt will not be discharged.
Debtors Cannot Be Required to Reaffirm Debt Even Prior to a Discharge
In addition to the fact that reaffirmed debt is reaffirmed prior to a discharge, reaffirming debt is also done by choice. A debtor cannot be required by a creditor to reaffirm debt that is otherwise eligible for discharge in a bankruptcy. To be clear, any reaffirmation agreement must be entered into voluntarily.
Creditors and Debt Collectors Cannot Attempt to Collect Debts That Have Been Discharged
Once a debt is discharged in a bankruptcy case, U.S. bankruptcy law prohibits creditors from continuing to take actions to attempt to collect the debt. As such, when a creditor or debt collector contacts a debtor after a bankruptcy discharge and asks the debtor to make payments on the debt or to sign a reaffirmation agreement, that creditor or debt collector is likely in violation of U.S. bankruptcy law.
You should know that non-dischargeable debts do not need to be reaffirmed for a creditor or debt collector to continue attempts to collect. When a debt cannot be discharged in a bankruptcy case, you will still owe that debt. As such, a creditor or debt collector can take the same actions after your bankruptcy case to collect that they were allowed to take under consumer protection laws prior to your bankruptcy discharge.
Seek Advice from a West Palm Beach Bankruptcy Lawyer
If you have any questions about how debts are handled in a bankruptcy case, how debts are discharged, or your rights after a discharge, you should seek advice from a bankruptcy attorney. One of the experienced West Palm Beach bankruptcy lawyers at Kelley, Fulton, Kaplan & Eller will be able to provide you with more information and can answer any questions you have.