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 Tennessee, as in other states, bankruptcy law allows individuals to discharge certain debts, but they may choose to keep some secured debts like a home mortgage or car loan through a process called reaffirmation. Reaffirmation is an agreement between the debtor and the creditor to continue the payment obligation on the secured debt, allowing the debtor to keep the property. The reaffirmation agreement must be entered into voluntarily and must not place an undue burden on the debtor or their dependents. The debtor must be current on the loan payments and must have sufficient exemptions to cover the equity in the property. The agreement must be filed with the bankruptcy court and is subject to court approval. If approved, the debtor remains legally obligated to pay the debt despite the bankruptcy discharge. It's important for debtors to consider the implications of reaffirmation carefully, as it can have long-term financial consequences. Consulting with an attorney is advisable to understand the full legal effects of reaffirmation agreements under Tennessee law and federal bankruptcy regulations.