Bankruptcy law generally allows you to break your contracts with creditors to help you get out of debt. But sometimes you may want to keep a home mortgage or car loan as you work to recover from your bankruptcy. Reaffirmation is a process in bankruptcy where you agree to remain responsible for the debt or loan so that you can keep the property (house or car) that is securing your repayment of the loan.

In reaffirmation, you and the creditor enter into a new contract—usually on the same terms—and submit it to the bankruptcy court for approval. You will have to be current on your payments of the loan, and you must be eligible for a bankruptcy exemption that will allow you to protect all of the equity in the property securing the loan you want to reaffirm.

In New York, reaffirmation agreements in bankruptcy allow debtors to keep certain secured assets, such as a home or car, by agreeing to continue paying the debt despite the bankruptcy. To reaffirm a debt, the debtor and the creditor must create a new contract, which typically retains the same terms as the original agreement. This new contract must then be filed with the bankruptcy court for approval. The debtor must be up-to-date on loan payments and must have sufficient bankruptcy exemptions to cover the equity in the property they wish to keep. It's important to note that reaffirmation is voluntary and not required by bankruptcy law. Debtors should consider the implications carefully and may seek advice from an attorney to ensure that reaffirmation is in their best interest, as it will obligate them to repay the reaffirmed debt despite the bankruptcy discharge.