Summary:
The Debtor filed a pro se reaffirmation agreement for a lease, but the bankruptcy court held not only would this reaffirmation be an undue hardship under 11 U.S.C. § 524, but also that assumption is governed by the procedures under 11 U.S.C. § 365(p). Following In re Giles, No. 11-50864, 2012 Bankr. LEXIS 3672, at *1 (Bankr. M.D.N.C. Aug. 9, 2012); In re Walker, No. 06-11514, 2007 WL 1297112, at *1 (Bankr. M.D.N.C. Apr. 27, 2007), the bankruptcy court disapproved the reaffirmation.
Commentary:
This is an example of where the different practices between districts can easily confuse not only consumers, but also consumer debtor's attorneys. While the E.D.N.C. routinely disposes of reaffirmations without a hearing for debtors where her attorney did not sign the certification (often granting a Hardiman ride-through, the M.D.N.C bankruptcy judge will hold a hearing and the debtor's attorney will usually appear, if only to explain that to the debtor that the result is not a loss of the vehicle, but merely a termination of the personal liability. This is compounded by the judicial restraint, which often comes across as coyness, in not explaining to the debtor that the lack of a reaffirmation under these circumstances does not allow repossession of the vehicle, absent some other default, usually meaning missed payments.
For a copy of the opinion, please click here:
Blog comments