John has arranged a confirmation with his mortgage company that will be approved by the court. It reaffirms the debt it owes to the mortgage of the house, with the possibility of renegotiating the payments with the lender. He and his mortgage company agree during the confirmation process of a lower monthly mortgage payment or a lower interest rate. John can make those lower payments with a few odd jobs he could find. In one sentence: If you want to keep the guarantees of a debt (for example. B a vehicle) for you, you must generally agree to pursue this debt, which you do by signing a confirmation agreement. This agreement excludes that a debt arived from the relief (of legal amortization) of your debts is granted by your bankruptcy case. It is in the borrower`s best interest to go through legal proceedings, such as confirmation. B, when it comes to solving or managing financial obligations. In general, when you file for bankruptcy, all or most of your debts are repaid and you are no longer responsible for that debt. A confirmation agreement comes into play when dealing with secured creditors (i.e.
auto loans, mortgages, etc.). If you validate a debt, you sign a contract that holds you responsible for that debt after receiving your discharge from bankruptcy. Confirmation prevented Jean from closing his house. However, if the lender is unable to make the mortgage payments under the new conditions, the lender will take possession of its home and initiate foreclosure proceedings. The problem is that you usually don`t know when your confirmation agreement request occurs. Also, after signing, most lawyers think you won`t change your mind about it. This is how you will hear about your right to retract, but most of the time, no one will see or persecute it when that right expires. Any confirmation agreement must be concluded before launch. If you are about to confirm a debt and you believe it will not be deposited until the discharge period expires, notify the registry in writing to delay the opening of the discharge until confirmation is submitted. Debtors voluntarily enter into affirmation agreements. These are legal documents, but a person cannot go to jail for injuring them. If the debtor does not make its planned payments and does not comply with the agreement, the lender takes possession of the guarantees if it wishes.
A confirmation is a document that constitutes an agreement between you and the creditor in which you agree not to pay or change the debts during your bankruptcy proceedings, and they accept that you can keep the terms of the agreement. These are most often executed for auto loans during bankruptcy, but may apply to a mortgage or other financial agreement. If you sign this, you will no longer be entitled to bankruptcy protection if you no longer make payments afterwards. (The exception may be, if there is a specific reason, why you are considering resigning at the time of signing the confirmation agreement. We give an example towards the end of this blog post.) The vast majority of the time will not withdraw you from a confirmation agreement.