Reaffirmation Agreement

Drafts a court-ready reaffirmation agreement allowing a debtor to retain secured collateral by voluntarily reaffirming a dischargeable debt under 11 U.S.C. § 524(c). Must comply with Bankruptcy Rule 4008 and Official Form 240A.

Prerequisites

Collect before drafting:

Parties — debtor/creditor legal names, addresses, case number, chapter filed
Original loan — date, principal, interest rate, payment amount/frequency, maturity
Current status — outstanding balance (principal + accrued interest + fees), payment history, default status
Collateral — description, current fair market value, lien position
Modified terms (if any) — reduced rate, extended term, principal reduction
Schedule I and J — debtor's current income and expenses for undue hardship analysis
Representation status — whether debtor has counsel (determines court approval requirement)

Document Structure

Part A: Agreement Summary

Present as a table:

| Field | Value | |---|---| | Debtor Name | {name} | | Case Number | {case no.} | | Creditor Name | {name} | | Total Debt Reaffirmed | ${amount} | | — Principal | ${amount} | | — Accrued Interest | ${amount} | | — Fees/Costs | ${amount} | | Collateral Description | {description} | | Collateral Fair Market Value | ${amount} | | Annual Percentage Rate | {rate}% | | Monthly Payment | ${amount} | | Payment Duration | {months/years} | | Total of Payments | ${amount} |

Part B: The Agreement

Party identification — full legal names, addresses
Original loan terms — date, principal, rate, payment, frequency, maturity
Reaffirmed terms — state whether original or modified terms apply
If modified, include side-by-side comparison:

| Term | Original | Reaffirmed | |---|---|---| | Interest Rate | {orig}% | {new}% | | Monthly Payment | ${orig} | ${new} | | Remaining Term | {orig} | {new} | | Total Remaining | ${orig} | ${new} |

Part C: Debtor Certification

Debtor certifies under penalty of perjury:

Agreement is voluntary and not required
Debtor can make required payments
Agreement does not impose undue hardship on debtor or dependents
Debtor understands right to rescind within 60 days after filing or before discharge, whichever is later (§ 524(c)(4))
Debtor understands default allows repossession AND deficiency pursuit

Part D: Attorney Certification

Required when debtor is represented. Attorney certifies:

Agreement fully explained to debtor
Debtor entered agreement voluntarily with informed consent
Debtor advised of legal effect, consequences, and default consequences
Attorney believes debtor can afford payments
Agreement does not impose undue hardship

Part E: Court Approval

Required when:

Debtor is not represented by counsel, OR
Schedule I/J shows income minus expenses insufficient to cover reaffirmed payments

Include notice of scheduled hearing; court must find (1) no undue hardship and (2) agreement is in debtor's best interest.

Signature Block

Include signature lines for:

Debtor — signature, printed name, date
Creditor — signature, printed name, title, date
Debtor's attorney (if applicable) — signature, printed name, bar number, date
Notarization block — include if required by local rules

Pitfalls and Checks

Rescission rights are mandatory — omission renders the agreement unenforceable under § 524(c)(4)
No coercion language — agreement must affirmatively state the debtor is not required to reaffirm
Default consequences — prominently warn: creditor may repossess collateral AND pursue deficiency balance
Collateral-to-debt ratio — if debt substantially exceeds collateral value, flag for additional disclosure; vulnerable to judicial scrutiny under undue hardship standard
U.S. Trustee review — draft anticipating objection; economic justification must be apparent on the face of the document
Local rules — verify whether the bankruptcy court requires notarization or additional local forms
Plain language — maintain legal precision while ensuring the debtor can actually understand the obligation