New Jersey Bankruptcy Lawyers

A Chapter 7 bankruptcy allows both individuals and couples who cannot meet their financial obligations to be excused from having to repay some or all of their unsecured debt. A Chapter 7 bankruptcy filing is the simplest, easiest, and fastest way to accomplish this. This type of bankruptcy is a liquidation process where your assets and property that are subject to the process are surrendered, sold, and the proceeds distributed to creditors.

Dischargeable debt includes:

• Credit Card Debt
• Medical & Dental Bills
• Personal Loans
• and other debt not backed by collateral

However, much of your personal property is exempt from the bankruptcy process under rules set up for this purpose. In many cases, you will not lose most of your personal belongings or assets such as household goods, stocks, clothing, pensions, public benefits, and more. This will be determined at the time your case is analyzed by our attorney. In exchange for the surrender of assets, your unsecured debt will be discharged by the bankruptcy court, giving you a clean slate. This does not apply to mortgages or vehicle loans, which you will be required to continue paying if you wish to keep them.

Do I Qualify for Chapter 7?

The primary requirement for Chapter 7 bankruptcy is passing the means test. This test determines if your income is low enough to qualify. It compares your current monthly income (CMI) to the median income for a household of your size in New Jersey.

• If your income is below the median, you generally qualify for Chapter 7.
• If your income is above the median, you may still qualify if your disposable income (after allowable expenses) is low enough to pass the means test.

The means test takes into account your income, expenses, and the size of your household. If you fail the means test, you may need to file for Chapter 13 bankruptcy instead.

You must be a resident of New Jersey or have lived, worked, or had a place of business in the state for the last 180 days (6 months) prior to filing. This is known as the domiciliary requirement.

Additionally, you must complete a credit counseling course from an approved agency within 180 days before filing. The course is designed to help you assess your financial situation and explore alternatives to bankruptcy.

The Process of Filling for Chapter 7

Below is an overview of the typical steps in the Chapter 7 bankruptcy process:

1. Filing the Petition: File your bankruptcy petition with the court, including detailed documents about your finances, debts, income, and assets. You'll also pay the filing fee unless you qualify for a fee waiver or installment plan.
2. Automatic Stay: Upon filing, an automatic stay takes effect, stopping creditors from pursuing collections. This halts foreclosures, garnishments, and other actions by creditors, giving you immediate relief.
3. Appointment of Trustee: The court appoints a trustee to oversee your bankruptcy case. The trustee reviews your documents and manages any assets that may be sold to pay your creditors.
4. 341 Meeting of Creditors: About 20-40 days after filing, you'll attend the 341 meeting where the trustee asks you questions about your finances. Creditors can also attend and ask questions, although they rarely do.
5. Liquidation of Assets (if applicable): If you have non-exempt assets, the trustee may liquidate them to pay your creditors. New Jersey exemptions allow you to protect certain property, so many filers retain most of their assets.
6. Discharge of Debts: Once the trustee completes their duties, your eligible debts will be discharged, meaning you no longer owe them. This typically happens 3 to 6 months after filing.
7. Post-Filing Education: After filing, you must complete a financial management course to receive your discharge. This course helps you manage your finances more effectively in the future.
8. Conclusion of Bankruptcy: After the discharge, the court will close your bankruptcy case. The bankruptcy will remain on your credit report for up to 10 years, but you can begin rebuilding your credit over time.

Can I File Bankruptcy Without My Spouse in NJ?

Yes, a married person can file for bankruptcy in New Jersey without their spouse. There may be meaningful advantages to having one spouse file bankruptcy without the other. It is crucial to speak with a knowledgeable bankruptcy lawyer to determine whether or not it is in your best interests to file for bankruptcy on your own or as a couple.

Experienced NJ Bankruptcy Attorneys

At Blanch Legal Firm, our New Jersey bankruptcy attorneys have helped countless individuals put an end to a dire financial situation through the application of the Chapter 7 bankruptcy process. We can help you understand how the process works, review your financial situation, and help you make an informed decision about whether a Chapter 7 filing might be right for you. This type of personal bankruptcy process is designed to eliminate unsecured debt legitimately and to give honest debtors a fresh financial start.

Facing crushing debt? Talk to a New Jersey bankruptcy lawyer at Blanch Legal Firm about your financial scene in a free consultation. Contact us at (201) 257-5388.