What is a reaffirmation agreement?

A reaffirmation agreement is a legal document used in California debtor and creditor law. It states that a debtor agrees to pay a certain debt despite the fact that it could have been discharged in bankruptcy. Reaffirmation agreements are essentially a voluntary promise to pay back a debt. Reaffirmation agreements can be used for debts such as car loans, mortgages, or medical bills. Prior to the confirmation of the agreement, a debtor is required to receive counseling from an approved credit counseling agency. This counseling explains the terms of the agreement and the effects of the reaffirmation on the debtor’s financial standing. If the debtor decides to sign a reaffirmation agreement, he or she must sign the document and file it with the court. After the filing, the court will review the agreement to ensure that it is fair and reasonable. Once the agreement is approved by the court, the debtor is required to follow and fulfill the terms of the agreement. Reaffirmation agreements can help debtors maintain their credit standing by continuing to pay the debt and keeping it from being discharged through bankruptcy. It is important to note, however, that signing a reaffirmation agreement is not a requirement in bankruptcy proceedings. The decision to enter into a reaffirmation agreement should be made carefully and with full consideration of the consequences.

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