What happens if I don't reaffirm my car loan after a repo?

I was told by a friend that I should reaffirm my car loan since I'm in bankruptcy proceedings. Is a reaffirmation agreement really necessary?

Answer
While bankruptcy proceedings are certainly stressful, don’t fret too much. Even if you don’t reaffirm your car loan after a repo, many lenders will continue to do business with you.
The reason that lenders will still work with you even if you don’t reaffirm your loan is because they assume that if you keep making payments, they’ll make more than they would by repossessing the car and selling it at auction.
However, you will want to consult your bankruptcy attorney to make sure that not reaffirming your car loan is the best move for your specific situation.
To save on other car expenses and put more money toward your loan, download the Jerry app. Jerry will gather competitive car insurance quotes from up to 50 top insurers for free so you can find the best deal and avoid overpaying. The average Jerry user saves $879 a year on car insurance.
Eric Schad
Answered on Nov 15, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
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