New Jersey Bankruptcy Law Blog

The automatic stay and its exceptions

At Goldman & Beslow, we know that when you owe a significant amount of debt in New Jersey, you may start experiencing annoying behavior by creditors that sometimes reaches the level of harassment. Examples include calling you several times a day and making threats against you. As a last resort, creditors may even bring lawsuits against you. 

If you are looking for a way to put a stop to these activities and regain some peace and serenity, you might want to consider filing for bankruptcy. Once you file Chapter 13, most of your creditors will no longer be able to contact you. This is because, upon filing, an automatic stay goes into effect that puts a halt to collection activities such as lawsuits, wage garnishments, foreclosures and repossessions. 

Fair debt collections: Do you know your rights?

In 1977, the U.S. government enacted a law that protects you regarding any and all debts you owe at any given time. The Fair Debt Collections Practices Act prohibits creditors and collection agencies from harassing people who owe money on their credit cards or to a mortgage lender, etc. Have you been getting numerous phone calls every day, at work and at home? Do the callers say they are attempting to collect a debt but refuse to identify the original creditor?

These are just a couple issues that would fall under fair debt collections. Just because your credit card balance has gotten out of hand or you haven't been able to make monthly mortgage payments on time, this doesn't give people the right to harass you with unsolicited phone calls, especially if the person calling is threatening you with litigation or using intimidation tactics to try to scare you.

What is a zombie title?

If you face a foreclosure in New Jersey, you probably expect that the bank will carry through with it. You will get a notice, have to leave your home and move on. The bank will sell your home and recoup some of its investment. However, this is not always what happens. There is the possibility that your bank could walk away from the foreclosure. If this happens, it could mean bad things for you.

The main objective during a foreclosure for the bank is to get its money back. If you stop paying, the bank takes back the property and sells it to someone else. Forbes explains that there are times when a bank does not complete the foreclosure, which results in a zombie title.

Can you file bankruptcy due to student loan debt?

If you have high student loan debt in New Jersey and are struggling to pay your monthly bills, you may be thinking bankruptcy is your only option. Unfortunately, bankruptcy does not discharge student loans except under extreme circumstances. However, if you have federal loans there is alternative for you to make your monthly payments more affordable.

According to Federal Student Aid, the courts may discharge your loan in bankruptcy if you can prove paying back the loan causes undue hardship. In order to do this, you must meet three factors:

  • You are unable to meet minimum living standards with repayment
  • Your financial situation does not look like it will change over the term of the loan
  • You have made a good effort to pay back the loan up to this point

Preparing for Chapter 7 bankruptcy

If you are thinking about filing for Chapter 7, you could have a number of questions on your mind, especially if this is your first time filing for bankruptcy or you have not carefully reviewed the ins and outs of this route. Of course, it is crucial to explore all of your bankruptcy options and make sure that you have settled on the direction that is best for you. For many people, Chapter 7 is advantageous and can not only help them find a fresh start but get creditors off of their back. However, preparation is key, and the approach that one takes could impact the outcome of their case.

Once you are sure that Chapter 7 is right for you, it is pivotal to carefully go over your financial circumstances and develop a thorough understanding of how bankruptcy will affect you, not only from a short-term perspective but from a long-term point of view as well. Some people do not understand all of the obligations that Chapter 7 bankruptcy entails, or they are not prepared for the responsibilities that lie ahead, and this can be damaging. Not only can this potentially interfere with the success of a bankruptcy petition, but it can lead to unnecessary stress and confusion.

Charlotte Russe the latest retail giant to fall

As the world becomes more technology-based and many retail sales are starting to take place online, the future of brick and mortar stores is beginning to look quite bleak. New Jersey is no exception as several retail stores have had to shutter their doors because of a significant decrease in customer traffic and sales. 

In the most recent example of a retailer having to close their doors, the women's clothing store Charlotte Russe recently announced their decision to file for bankruptcy. Following in the footsteps of other retailers that are currently in bankruptcy proceedings, Charlotte Russe plans to close all 400 of its stores nationwide. The store was founded in 1975 and has targeted a younger audience of women through its sales of trendy clothing and jewelry. 

Chapter 7 bankruptcy will not destroy your credit forever

Many New Jersey residents are struggling financially right now. Are you one of them? If you are, you have surely spent time looking at all of the debt relief options out there. Chapter 7 bankruptcy may have crossed your mind, but you are worried about the long-lasting effects it will have on your credit score. Guess what? Bankruptcy will not destroy your credit forever.

Rebuilding your credit after bankruptcy is possible. It just takes time and effort. In the long run, choosing this form of debt relief may end up being the best thing for you.

Can I keep a savings when I file Chapter 13?

When you decide to file Chapter 13 bankruptcy, you may have many questions regarding your finances going forward. There are strict rules you must follow to stay within the guidelines of the court. The main one is following your repayment plan. However, what happens when you have changes in your income that give you some extra money each month. Can you put that into a New Jersey bank savings account?

According to PocketSense, whether you can create a saving account depends a lot on the exact increase of your income and your bankruptcy plan. You have to report any change in income when it is a 10 percent change. You would have to meet with your trustee to see how the increase will affect your repayment.

Preventing repossession of your car

If you are a New Jersey resident who has received warnings about possible repossession of your car due to nonpayment, you may be wondering what options are available to you to help you keep your vehicle. At Goldman & Beslow, we have seen many cases involving vehicle repossession. Here is some idea of the options available to you.

If you have fallen behind on car loan payments and had your car repossessed as a result, you may be able to get it back, but only if you act quickly. Filing an emergency bankruptcy within 10 days of the repossession may allow you to get your car back. Even if the initial 10-day period has already passed, filing for bankruptcy will discharge or reorganize your debts, although it will not return your car to you if the window of opportunity has closed. 

How to get out of debt without filing bankruptcy

It is not uncommon for New Jersey residents or Americans in general to live beyond their means and to accumulate massive debt out of which they then have difficulty digging their way out. Many of these individuals eventually resort to bankruptcy, but some either do not qualify for bankruptcy or want to keep their credit intact but still obtain debt relief. According to Moneyning, it is possible to dig one's way out of debt, but doing so will require intense effort and careful budgeting over a period of three to five years.

One thing Moneyning suggests doing is establishing an emergency fund of at least $500. In the event of an emergency, one can use the $500 instead of resorting to a credit card or loan.

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