A Bryan Bankruptcy Lawyer Discusses Reaffirming Your Credit after Bankruptcy
One of the primary concerns of our bankruptcy clients involves the damage a bankruptcy filing will inflict upon their credit rating. We often see clients with once-stellar credit struggling to regain their footing after an unfortunate and uncontrollable life event. The last thing these clients want to do is expose their credit rating to further detriment by filing for bankruptcy.
However, it is sometimes more advantageous to take a short-term credit rating hit by filing for bankruptcy than run the risk of extensive, years-long credit trouble handling your creditors on your own.
Reaffirming Your Debts during and after Bankruptcy One way to help your credit rating is by reaffirming some of your debts, particularly those that are secured by collateral like a car, home or boat. In a Chapter 7 bankruptcy proceeding, most debts are liquidated. In some instances, however, you may need to retain your underlying collateral, like your home or car, in order to continue your daily life.
In these cases, you can enter into a reaffirmation agreement wherein you indicate your intention to keep the asset despite the fact the debt should have been liquidated by bankruptcy. The terms of your mortgage or loan agreement will remain intact and you will continue to make payments as you did before. This process not only allows you to keep an asset you would have otherwise lost during Chapter 7, but allows you to rebuild your credit during a time in which most bankruptcy debtors experience a significant reduction in their credit rating.
Contact an experienced Bryan bankruptcy lawyer today If you have questions about the Chapter 7 process or would like to explore reaffirming some of your secured debts, contact a Bryan bankruptcy lawyer today. For more information, call the Peterson Law Group at 979-703-7014.