Bankruptcy Questions Answered

Reaffirmation Requires Written and Signed Contract Between You and Your Creditor

I have written before about the pros and cons of entering into a reaffirmation agreement with one or more of your secured creditors.  On the plus side, reaffirming a secured debt gives you a degree of certainty – you are once again in a contractual relationship with your creditor.  You know how much you are supposed to pay each month and you know the payoff balance, interest rate and terms of the agreement.

Further, you may be able to negotiate a more favorable deal when you reaffirm.  Other than cars, secured creditors are often not set up to liquidate used merchandise and since you already have possession of the property (collateral), many lenders are happy to negotiate more favorable terms with you so they can avoid the hassle of recovering and disposing of property.   This negotiation option is less true with motor vehicles, because there is an active used car market, but the negotiation option can work well when you are dealing with furniture or electronics.

Reaffirmation can also help you rebuild your credit because you are re-assuming personal liability for payments, and regular, timely payments usually will be reported as positive information to the credit bureaus.

On the other hand, when you reaffirm, you are re-obligating yourself personally to pay an installment note.  If you should default, you are fair game for all collection activities including wage garnishment.

Reaffirmation Must be in Writing, Signed by You and the Creditor and Approved by the Bankruptcy Judge

At least once or twice a month, I get an email from a frustrated individual who has received his bankruptcy discharge, and has continued to make monthly payments, but sees no mention at all about these payments on his credit report.

It is not enough that you checked the "reaffirm" box on your bankruptcy Statement of Intention.  You and your creditor have to complete a formal reaffirmation agreement.  These agreements usually consist of about 10 pages of legal speak and your attorney has to document that your budget can handle the reaffirmed payment.  Your attorney also has to sign the reaffirmation agreement and assert in writing that he thinks that reaffirmation is in your best interest.

Usually, reaffirmation agreements are prepared by the creditor or creditor's attorney.   Sometimes lenders simply will not cooperate – they may not have any objection to accepting your payment and leaving you alone regarding possession, but they may forward a reaffirmation agreement to you.

I have also seen situations where lenders fail to file the signed reaffirmation documents on time and the reaffirmation agreement does not get court approval even though the debtor and his attorney did everything they were supposed to do.

If you and your attorney confer and decide that reaffirming a particular secured debt makes sense for you and that you can afford the reaffirmed payment, you should encourage your lawyer to quickly and aggressively request a reaffirmation agreement from your creditor.  Once your case is discharged and closed, it is difficult and expensive to try to re-open a closed case solely for the purpose of reaffirming a debt.

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Giant Debt Collector Law Firm Mann, Bracken Out of Business

A number of stories have recently appeared in bankruptcy and consumer rights blogs suggesting that the Atlanta based collection firm Mann, Bracken, LLC has gone out of business.   On his Caveat Emptor blog, Minnesota bankruptcy attorney Sam Glover has written several posts about the Mann, Bracken firm including one on December 22, 2009 stating that the calls to the firm's phone number instructs callers to communicate directly with their creditors.   I called several numbers listed for Mann, Bracken but the calls were answered by a message that "all circuits are busy, try your call again later."

Although based in Atlanta, Mann, Bracken has a national practice and it has apparently been growing by merging with other law firms.   I found a web site called paymbw.com which purports to be a payment gateway for debtors to make electronic check or credit card payments on debts being handled by Mann, Bracken.  This site notes that Mann, Bracken is the successor by merger to Wolpoff & Abramson L.L.P., and Eskanos & Adler P.C., two collection law firms well known to debtor's lawyers.

The domain mbllc.com has a "coming soon" page and the registration information for that domain is private.   I looked up the contact information for the partners.  Douglas Mann's shows him as an inactive lawyer affiliated with Mann, Bracken.  Chris Bracken's registration shows a gmail.com email address, a business address at Mann, Bracken's location, but the space for the law firm information is blank.  Two other partners – Bill Layng and Steve Knezo – are now affiliated with other law firms.

Atlanta TV station WSB sent a crew to the Mann, Bracken offices and found deserted premises along with handwritten placards stating that the firm has closed down.  According to WSB, Mann, Bracken was associated with a large debt collector called Axiant, which is now in Chapter 7.

Based on all the information I can gather, the law firm of Mann, Bracken is no more.  However the demise of this firm does not mean that debts owed to clients of Mann, Bracken or Axiant are no longer collectible.   Apparently another large debt buyer/collector, NCO, has purchased or is about to purchase Axiant's accounts.

If you had a deal with Mann, Bracken to settle your debt, you may find that the underlying creditor or a subsequent collection agency may not honor your deal – so hold on to any paperwork you may have.  As attorney Glover notes on his blog, you should contact your creditor directly if you have previously been dealing with Mann, Bracken.

Posted in Bill Collectors, General consumer bankruptcy info, Georgia Bankruptcy, a, atlanta, axiant, based, bracken, bracken  , called, chris, collection, collection law firm, collector, debt, douglas, firm, including, large, mann, mann bracken, partners  , the | Comments Off