I received my chapter 7 (no assets) discharge but did not reaffirm my car loan. I am current on payments. What should I do?
Answer: In my experience, it is rarely necessary to reaffirm your vehicle loans in a Chapter 7 bankruptcy. If you state in your petition that you intend to retain the property and continue making all payments as they are due, and continue making said payments, almost all lenders will accept your payments. However, you do need to be aware that, technically, lender does have the right to repossess the vehicle even if you are current, as failure to reaffirm does put you in breach.
In general, your lender would much prefer to have you pay your car note with interest than to get a car which is likely worth less than the loan, with no way to recoup the deficiency against you. However, there are a few unusually aggressive lenders who may repossess the vehicle anyway, so you do need to be careful. After a few months, you can usually consider yourself safe – and you may be able to allege acquiescence, given that they accepted your payments.
The most important thing to remember at this point is that, if you fall behind, most lenders will probably go ahead and immediately take action instead of giving you time to cure. Therefore, be certain to make all payments on time. Also, your lender will generally stop sending you statements if the debt is not reaffirmed, as they do not want to risk a finding that they are in violation of the court’s discharge order. Therefore, the burden is on you to remember to keep making payments, even if you do not receive a bill.