## Facts

- Akhter Husain and Farah Husain filed a joint Chapter 7 petition on October 24, 2006, and were represented by bankruptcy counsel.
- The debtors sought to keep two vehicles subject to secured claims and executed two reaffirmation agreements after filing.
- BB&T held a lien on a 2004 Toyota Corolla; the reaffirmation proposed reaffirming $12,302.03 at 14.79% simple interest, payable in 54 monthly payments of $310.25; the debtors scheduled the vehicle’s value at $10,375.
- Toyota Motor Credit Corporation held a lien on a 2003 Toyota Avalon; the reaffirmation proposed reaffirming $15,438.92 at 15.6% simple interest, payable in 61 monthly payments of $388.15; the debtors scheduled the vehicle’s value at $8,415.
- The debtors’ schedules showed monthly expenses exceeded monthly income by approximately $4,000, even before adding the proposed reaffirmation payments.
- Although represented, debtors’ counsel refused to sign the attorney certification required by 11 U.S.C. § 524(c)(3) for either reaffirmation agreement.
- The debtors moved for court approval, asserting they could cover the deficit through expected income increases and additional work hours.

## Issues

1. Whether a bankruptcy court may approve reaffirmation agreements for debtors represented during negotiation when counsel refuses to provide the § 524(c)(3) attorney certification.
2. Whether the debtors could be treated as “unrepresented” for purposes of court approval under § 524(c)(6) despite having counsel.
3. Whether, on these facts, the reaffirmation agreements were in the debtors’ best interests and did not impose an undue hardship, including under the § 524(m) presumption.

## Decision

- The court declined to approve both reaffirmation agreements.
- The court held that, for represented debtors, the § 524(c)(3) attorney certification is mandatory; without it, the agreements are unenforceable and cannot be salvaged by court approval.
- The court rejected treating the debtors as unrepresented to bypass counsel’s refusal and shift the gatekeeping role to the court under § 524(c)(6).
- Independently, the court found the agreements were not in the debtors’ best interests and would impose an undue hardship given the debtors’ substantial negative monthly budget and the loan terms.

## Legal Principles

- A reaffirmation agreement for a debtor represented during negotiation is enforceable only if it satisfies § 524(c), including the attorney certification required by § 524(c)(3); the certification is not optional.
- A debtor who was represented in negotiating a reaffirmation agreement cannot circumvent § 524(c)(3) by claiming “unrepresented” status to obtain court approval under § 524(c)(6).
- Under § 524(m), a presumption of undue hardship arises when the debtor’s income minus expenses is insufficient to make the reaffirmed payments; speculative future income generally does not rebut the presumption.
- Courts may refuse approval where reaffirmation would likely impair the debtor’s post-discharge financial condition and is inconsistent with the fresh-start policy, even if the debtor seeks reaffirmation to retain collateral.

## Conclusion

The court refused to approve the debtors’ vehicle reaffirmation agreements because counsel’s refusal to provide the required § 524(c)(3) certification made the agreements unenforceable for represented debtors, and because the debtors’ large monthly deficit and speculative income projections showed the reaffirmations would impose an undue hardship and were not in their best interests.


In re Husain, 364 B.R. 211 (Bankr. E.D. Va. 2007)