CHEYENNE, Wyo.-A federal bankruptcy court has denied a proposed reaffirmation agreement on a credit union car loan, ruling that the member of First Educational CU, who represented himself in the negotiations, did not complete the Chapter 7 Individual Debtor's Statement of Intention required of debtors without lawyers.
The court ruled that the reaffirmation on three loans secured with an outstanding balance of $3,100 by a 2002 Kia was not in the best interest of the member, identified as Chris Mowrey. Under the proposed reaffirmation, Mowrey would repay $12,500 on the three loans secured by the car, valued at just $1,500. "When taking into consideration that the three agreements total a repayment of approximately $12,500 for a vehicle valued at $1,500, the Court cannot find that approval of the reaffirmation agreements are in the Debtor's best interest," the court ruling stated.
The member's net pay is between $1,400-$1,500 per month. He lives with his girlfriend, and between them, they have four dependants. The 2002 Kia is the member's only vehicle. The member's monthly expenses are $3,837 and he is current on the monthly payments on all three credit union loans.
For additional information on the court ruling, visit www.cujournal.com.
