If I did not sign a reaffirmation agreement on my car and turn it back in after the bankruptcy was discharged, am I legally liable for the money owed?

I had a Chapter 7 discharged 1 year ago and stated on the statement of intent to reaffirm but never signed a reaffrimation agreement. The lender stated they did not have on on file and if I wanted to keep the car just keep paying payments and I can keep it. I am way upside down on it and no longer need the car and want to surrender it back to gmac. Will I be responsible for the difference in what the car sales for and the balance owed or is that covered in the Chapter 7?

Asked on July 17, 2012 under Bankruptcy Law, Indiana


Terence Fenelon / Law Offices of Terence Fenelon

Answered 8 years ago | Contributor

Not really enough info to answer.  Was GMAC lisye as a creditor?  What did your statement of intent indicate. 

In most situations, if the property and the debt were properly list ( schedules B and D , as well as statement of intent), you could turn in your vehicle and the creditor would have no recourse.  In other words, the debt which existed prior to filing the petition would be wiped clean, and the finance co. would sell the vehicle, apply the proceeds to your account, and take a loss for the remainder, which is probably interest and fees to begin with

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