QUESTION
After bankruptcy, if you surrender a vehicle, can the bank report negatively on your credit report?
Asked on Sep 07th, 2013 on Bankruptcy - North Carolina
More details to this question:
We had a bankruptcy discharged approximately a year ago due do $300k of medical bills. The judge did not approve the reaffirmation agreement so we kept the vehicle & have continued making payments. Due to a loss of income, we are considering turning the vehicle in but since we're trying to rebuild our credit (and have purchased 2 other vehicles since then) we are concerned the bank will report negatively on our credit report. They have not reported anything (our on time payments) and we've tried talking to them to get our payments lowered but they're absolutely not willing to help out. We are just concerned they'll report negatively now if we do turn it in or is it covered under the bankruptcy?
7 ANSWERS
Its covered by the bankruptcy discharge.
Answered on Sep 16th, 2013 at 5:44 AM
If you the judge did not approve the reaffirmation agreement, the auto loan was discharged. Therefore, if you surrender the vehicle to the lender they cannot come after you for a deficiency judgment and that does not create any new liabilities for you than can be reported to the credit reporting agencies.
Answered on Sep 11th, 2013 at 12:43 PM
2 Awards
The auto lender is not reporting your payments to the credit bureau because you did not reaffirm the debt. If you surrender your vehicle to the auto lender it will be noted on your credit report that the debt was discharged.
Answered on Sep 10th, 2013 at 4:47 AM
Debt Settlement Attorney serving San Diego, CA
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Law Offices of Kathryn Tokarska
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If you have not reaffirmed the loan, it should not have an impact on your credit report. That is one of the benefits of not reaffirming when possible.
Answered on Sep 09th, 2013 at 6:29 PM
Once you have a bankruptcy discharge, a lender cannot continue to report additional information about the loan other than the bankruptcy unless there was a reaffirmation of the debt approved by the court.
Answered on Sep 09th, 2013 at 1:11 PM
Personal Injury Attorney serving Glendale, CA
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JT Legal Group
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I don't know what other facts there are which you did not share but based on what you've said, they cannot report negatively.
Answered on Sep 09th, 2013 at 1:03 PM
Corporate & Incorporation Attorney serving Huntersville, NC
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Elliott Law Firm, P.C.
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If the reaffirmation agreement was not approved and therefore never entered, the underlying was discharged. The only proper credit reporting on this debt would be discharged in bankruptcy, although the creditor does not have to report anything at all.
Answered on Sep 09th, 2013 at 12:52 PM