I have a case where the creditor’s attorney sent me a Reaffirmation Agreement. I had never had a creditor’s attorney try to have the creditor’s debt reaffirmed. Moreover, the creditor is over-secured with a deed of trust lien on the debtors’ principle residence. I read Section 524(c)(1) of the Bankruptcy Code. Without researching the case law, it appears this section allows Chapter 13 debtors to reaffirm otherwise dischargeable debts. Has this creditor admitted that it did not have a valid and pre-existing lien before the filing of my clients’ Chapter 13 bankruptcy case? Also, the Reaffirmation Agreement did not give the debtors the disclosures required under Section 524(k). Why would a creditor file a Reaffirmation Agreement under these facts, assuming that the debtors received the statutory 524(k) disclosures?
The Oklahoma Bankruptcy Lawyer, Dan Nunley, blogged about Reaffirmation Agreements In Chapter 7. Click here, to read his reasons why not to sign a Reaffirmation Agreement.