Chapter 7 client pawned title to her car in the amount of $3,000.00 (pre filing) and then sold the car for salvage (pre filing). The creditor will not work out a deal and wants client to reaffirm the whole amount. The creditor’s remedy in light of the destruction of the collateral was to object to the discharge under 523(a)(4) or (6). Once the debt was discharged, that remedy is gone as well as the pressure to reaffirm. Once the discharge order goes into effect, reaffirmation is no longer possible. A debtor cannot reaffirm what is already discharged by court order.
Related posts: