Legal Question in Bankruptcy in Nevada

Reaffirmation on secured holdings

I filed bankruptcy last year and I had 2 automobiles that were to be held and paid as agreed. These accounts are not being reported to the credit bureaus correctly because the financial institution did not receive the reaffirmation form signed and submitted to them by my attorney. In order for my attorney to not be at fault he is claiming that in the state of Nevada it is not required that this form be filled out on secured holdings. My attorney claims that the bankruptcy judge would have thrown this form out and refused to sign. I need to know if this is correct and what I can do to remedy this matter.


Asked on 6/24/02, 1:33 pm

1 Answer from Attorneys
Paul Malikowski Malikowski Law Offices, Ltd.

Re: Reaffirmation on secured holdings

Reaffirmation is not required under Ninth Circuit decisional law and better bankruptcy practice compels the advice given to not seek reaffirmation approval from the Court. If the debtor is current on his vehicle contracts and that fact is not correctly reported, he should hire an attorney to have the law governing credit reports followed, instead of blaming his competent bankruptcy attorney for an unrelated problem. Getting reaffirmation approval means that the attorney certifies that the agreement is not a hardship to the debtor or a dependent of the debtor. In the event the loan is upside down and a post-bankrutpcy default occurs, the reaffirmed loan can be enforced and a large deficiency judgment obtained by the creditor. This could result in post-discharge wage garnishment, creating a hardship on the debtor and his dependents. Why would a debtor want to risk that? Why would an attorney risk the malpractice liability? Who gains on a reaffirmation? Only the creditor.

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Answered on 6/24/02, 2:01 pm


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