How to Claim Bankruptcy in NJ – NJ Bankruptcy Lawyer

Credit Card DebtHow Much of Your Debt is Dischargeable?

In deciding whether or not you should claim bankruptcy, you should first analyze all of your financial obligations and figure out how much of your debt is dischargeable. To be “dischargeable” means that it is a type of debt that can be permanently forgiven after the bankruptcy estate is finalized by the Bankruptcy Court. Typically, credit card debts and medical bills are dischargeable. Student loans, taxes and spousal or child support obligations, however, are generally not dischargeable. You should obtain a copy of your credit report so you can accurately determine the extent of your obligations.

Should You Claim Chapter 7 or Chapter 13 Bankruptcy?

The next step in the process is to determine what Chapter under the Bankruptcy Code you wish to file under. In a Chapter 7 bankruptcy, a bankruptcy trustee is assigned by the Bankruptcy Court to liquidate all of your non-exempt assets and use those proceeds to pay off your various creditors and subsequently discharge your debt. Chapter 7 is most often utilized by individuals who are entitled to certain property exemptions under the Bankruptcy Code. To determine what the exact nature of the bankruptcy exemptions are you should check with an experienced NJ Bankruptcy Lawyer.

Chapter 13 bankruptcy is often utilized when you have regular income and you wish to maintain the majority of your assets by making payment arrangements through a court-approved plan, which is typically three to five years in duration. Chapter 13 is utilized if you are facing foreclosure and you have the ability to pay your debts back over time.

Claiming Bankruptcy in NJ Involves Documentation of Your Finances

You must complete a financial statement called a “schedule” which is filed along with your bankruptcy petition and includes all of your property, income sources, debts and monthly expenses. Your monthly expenses should consist of your entire household budget. You should have an experienced New Jersey bankruptcy attorney assist you with the preparation of these forms. The NJ Bankruptcy Lawyers at Villani & DeLuca, P.C. offer a free consultation and will be able to answer all of your questions about the process of claiming bankruptcy in New Jersey. Call (732) 965-3390 to speak with an experienced NJ Bankruptcy Lawyer today!

The Bankruptcy Petition Initiates a Bankruptcy Claim

The actual document that is filed with the New Jersey Bankruptcy Court is called the petition. The petition contains a list of forms which need to be completed. Although the list is lengthy, if the documentation is filled out completely and accurately, it will lessen the chance of there being any difficulties during your bankruptcy filing. The forms include a statement of your current income, means test calculation, a payment advice certification, statement of intent and, if applicable, a model Chapter 13 plan. The petition and accompanying forms need to be filed out carefully. You also need to identify any debts that you wish to reaffirm, or continue to pay, thereby omitting them from the bankruptcy process.

You will need to submit the names and addresses of all creditors to the court so they can be properly notified that you have filed for bankruptcy and that the automatic stay is in place. The automatic stay prohibits any of your creditors from contacting you or taking any legal action against you during the bankruptcy process. Once all of these documents are completed and you have finished the required credit counseling course within the 180 days prior to your bankruptcy petition, you will then be in a position to file the petition.

What Happens After Filing Your Bankruptcy Petition in NJ

Subsequent to the filing of your bankruptcy petition, the Bankruptcy Court will then mail the appropriate notice to all creditors that the automatic stay is in place. The court will then appoint a trustee to evaluate your petition. In the event that the trustee makes any recommendations or requests, you are required to comply.

Next, you will be required to attend a 341 meeting of creditors. At this meeting, creditors will be allowed to ask you questions regarding your debts and assets to determine if they wish to file any claim with the Bankruptcy Court in order to prevent their debt from being discharged. Often times, the creditors do not appear at this meeting. In a Chapter 13 bankruptcy, you will be required to attend a plan confirmation hearing wherein the court makes a determination as to whether or not they will accept the plan.

Your case is concluded once the trustee files a report with the court stating that your estate has been liquidated or, in the alternative, that there are no assets to liquidate. Once the report is approved by the court, your debt will be discharged in a Chapter 7 filing or in a Chapter 13 your payment plan will be accepted. A Chapter 7 discharge usually takes about 60-90 days after you file your petition. A Chapter 13 is discharged as soon as your payment plan is successfully completed.

Contact Villani & DeLuca to Claim Bankruptcy in NJ

Should you have any questions about the steps outlined herein, please schedule a free consultation with a Villani & DeLuca NJ Bankruptcy Lawyer. Villani & DeLuca has offices located in Wall Township, New Jersey and Point Pleasant Beach, New Jersey. Please call (732) 965-3390 today!