West Palm Beach Bankruptcy Lawyer

Reaffirmation Agreements

Bankruptcy proceedings frequently wipe out all of a person’s debts, regardless of whether the account was in good or bad standing at the time of the discharge. In some cases, a debtor will want to keep a debt that is in good standing and pay it back on his or her own.

One way a debtor can be permitted to pay back a debt rather than have it discharged is a reaffirmation agreement. A reaffirmation agreement in United States bankruptcy law is a contractual agreement made between a creditor and a debtor. The agreement waives the discharge of a debt that would otherwise be discharged with other debts in a pending bankruptcy proceeding.

When a reaffirmation agreement is properly executed and filed in a timely fashion, the discharge of debts is modified in a way that it is rendered inoperable against the subject debt. The subject debt is the debt mentioned in a reaffirmation agreement. Basically, a discharge order is inoperable against the debt in a reaffirmation agreement. The debt in the agreement becomes immune.

Reaffirmation agreements are popular for use against debts that are still in good standing. Some individuals with credit card debts that are held by a credit union are also subject to reaffirmation agreements. This allows the debtor to stay in good standing with the credit union and continue to use the credit union for banking.

Contact a West Palm Beach Bankruptcy Attorney

If you are in a dire financial situation and are considering filing for bankruptcy, contact the West Palm Beach bankruptcy lawyer of Eric N. Klein & Associates at 561-353-2800 to determine which type of bankruptcy is best for you.