New Jersey Chapter 20 Bankruptcy Lawyer

You may never have heard of a "Chapter 20 bankruptcy." That is because technically it does not exist. To file for Chapter 20 bankruptcy, first you file for a Chapter 7 bankruptcy to eliminate your unsecured debt such as credit card debt. Shortly afterward, you file for a Chapter 13 bankruptcy to pay down your secured debt such as mortgage arrearages and perhaps, strip off second and third mortgages.

Using Successive Bankruptcies to Eliminate Your Debt

If you do not meet the eligibility requirements for a Chapter 13 bankruptcy, because you have too much unsecured debt and too much secured debt, you may possibly be able to use a Chapter 20 to discharge your unsecured debt by filing for Chapter 7 bankruptcy in order to qualify for a Chapter 13. Once you qualify for a Chapter 13 bankruptcy, a payment plan is put into place to pay down the secured debt that you owe.

Advantages of this method are that you may be able to save your home and eliminate your unsecured debt if you owe too much to qualify for a regular Chapter 13 bankruptcy.

Disadvantages of this method are that you only receive the discharge of your debt at the end of your Chapter 7 bankruptcy. You must structure your Chapter 13 plan so that you pay off your secured debt in full and you cannot miss a payment. There have been some court rulings denying Chapter 20 cases. We are versed in the law and will explain potential pitfalls to you.

Our New Jersey Chapter 20 bankruptcy attorneys can help you determine if filing successive bankruptcies would work well for your financial situation.

Possible Obstacles to Filing Chapter 20 Bankruptcy

While it is technically legal to use this filing and process system to get yourself back on a sound financial footing, there are some courts that are objecting to its use. Your plan's approval by the courts depends on your financial situation, the kinds of debt you are trying to eliminate and how you plan on paying off your secured debt. As with any bankruptcy, you must participate in a financial management course, which will be conducted online or over the phone, to complete the bankruptcy proceedings.

We will look at all of your options and find the most effective solution to your financial problems. We want you to have a clean start on your financial life.

Contact experienced personal bankruptcy lawyers with offices in Paterson, Jersey City and East Orange today to find the solutions to your financial problems. Call for a free consultation at 973-414-8069 or 888-827-5493.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.