New Jersey Bankruptcy Law Blog

Determining the most viable bankruptcy option in financial crisis

Like most adults in New Jersey, you've likely encountered and overcome numerous financial challenges. Some situations are definitely more serious than others. In fact, if a financial problem gets out of control, you may not have the means for getting things back on track without tapping into additional resources, such as bankruptcy. If you're the type of person who cringes at the mention of that word, you are definitely not the only one. In the past, there were social stigmas attached to bankruptcy that made it undesirable.

Nowadays, however, many more people have come to understand that filing for bankruptcy can be a valuable financial tool. It not only can help you obtain immediate debt relief but may also help lay the groundwork for a stronger financial future. There are several types of bankruptcy though, and it's critical that you understand the differences between them so that you can determine which option best fits your current needs and ultimate financial goals.

Can strategy help me avoid financial pitfalls?

Maintaining your finances is something that may look different to you than it does to your neighbors or family members in New Jersey. Regardless of how you do it, staying out of excessive debt and minimizing unnecessary spending are important ways to create a strong financial foundation. With the right tools and strategies, you can fortify your future beginning with healthy money habits. 

While there are all kinds of tips and tricks for managing your money, the key points that you should always remember include staying out of debt, saving for the future and keeping track of your expenses. These three practices are all invaluable ways for you to effectively track your spending habits and identify where your income is going so you can adjust as needed. Maintaining organized financial records is also important for tax purposes. 

Can equity be the reason I keep my home in bankruptcy?

Property exemptions differ depending on whether you file for Chapter 13 or Chapter 7 bankruptcy in New Jersey. Chapter 13 exemptions are not as strict, are higher and more flexible than if you were to file for Chapter 7. However, some homeowners cannot resist filing for Chapter 7, which places their property at greater risk of being sold off. However, equity can still help save a Chapter 7 filer’s home.

FindLaw explains the role of house equity in Chapter 7 bankruptcy. Equity is defined as the market value of a house once mortgage balance or home equity loans are subtracted. If the equity in a house reaches the level higher than a bankruptcy exemption will allow, the bankruptcy trustee will determine that the value of the house allows it to be sold to pay off creditors.

Seeking a fresh financial start

Like many New Jersey residents, you may feel trapped under a heavy weight of financial debts that makes it impossible to go about your daily life without constant worry. After receiving yet another call from a debt collector, you may wish for a fresh financial start in order to live a stress-free life and be wondering how you can make this happen. At Goldman & Beslow, we have assisted many clients in reclaiming their lives while getting back on the path to financial stability. 

People accumulate personal debt in many ways. Maybe, like many Americans, you had some tough times and put too many living expenses on your credit cards, which then multiplied out of control. According to Forbes, in 2018 Americans surpassed $1 trillion in credit card debt. Or, maybe you incurred substantial medical debt that you were not able to pay off as quickly as possible, or are struggling under the weight of student loans. If you have exhausted all options in terms of trying to negotiate more favorable payment terms with your creditors, a Chapter 7 bankruptcy may be something to consider.

Can demoting yourself help you with bankruptcy?

Owning and running your own business can be a thrilling experience, which is why some New Jersey business owners may not like the idea of going back to being an employee and taking orders from someone else. And yet if you are going through Chapter 13 bankruptcy, becoming an employee again may actually be helpful and could help save your business from being sold to pay your debts.

Chron.com explains how this works. After filing for Chapter 13 bankruptcy protection, you work out a plan and present it to your bankruptcy judge. According to this plan, you will become an employee of your own business. This involves stepping down as the current owner and selling or transferring your business to a new owner who will keep you on as an employee.

New bill seeks to expand student loan debt relief options

It is not uncommon for people in New Jersey today to fund at least a part of their college education via student loans. For many decades, in fact, the amount of student loan debt across the United States has been on the rise. According to the Institute for College Access and Success, the average person with student loan debt owed approximately $33,000 in 2018. Among all borrowers, one out of every four is said to be either in default or behind on their payments.

For almost 20 years now, student loans have all but been non-dischargeable via bankruptcy. This comes after some time when borrowers had to wait either five years or seven years before pursuing bankruptcy relief for their student loans. The only way for a consumer to have a student loan debt discharged today is to prove that it puts them under an undue hardship. As CNBC explains, the definition of undue hardship is quite ambiguous and seems to result in an uneven application of the law.

Are you drowning in medical debt?

Numerous experts agree that most Americans are one medical emergency away from financial ruin. According to a fairly recent report, the average person spends over $10,000 on health care costs a year -- this does not include insurance premiums. If you are like most New Jersey residents, you likely do not have $10,000-plus sitting around to pay your medical debt obligations in full. What can you do?

Millions of Americans are drowning in medical debt. When there seems to be no end or relief in sight, it is time to start looking at debt relief options. Bankruptcy, for example, is one way to rid oneself of medical debt entirely or, at least, make it less of a burden. So, which type of bankruptcy is best when dealing with medical debt?

How can I get a handle on my debt?

Being faced with debt is emotionally daunting. You may feel as though you're making no progress as your bills continue to pile up. In this case, it's crucial that you take the proper steps to address debt and ensure it doesn't negatively impact your financial future. The Balance offers the following advice on how you can get a handle on any amount of debt. 

Don't miss payments

Your next steps after your car has been repossessed

After you have received notice that your vehicle is being repossessed you are left with the unpleasant reality that you are now without transportation. You may be feeling at a loss and wondering if there is any possible way to reverse the situation you are now in. At Goldman & Beslow, LLC, we are advocates for people in New Jersey who may be struggling with financial debt that has left them in challenging circumstances. 

If your car has been repossessed, chances are it is because you have neglected to pay your lender the agreed-upon amount for the loan you have been granted. In many cases, you can request an extension if you know that your payment will be late. In other circumstances, you may be able to negotiate with your lender to modify your loan to something more realistic for your current financial situation. However, if you are absolutely unable to pay your debt and cannot or have not worked anything out with your lender, you are at a much higher risk of having your vehicle repossessed. 

Qualifying for a mortgage after bankruptcy

If you are overwhelmed by debt, then a Chapter 7 bankruptcy may offer you a good chance to not only cease any activity that your creditors in East Orange have taken against you, but also allow for the chance to re-establish yourself financially. This latter benefit comes from the potential of having many of your debts discharged. Yet the price for enjoying it may be high, and that comes from the toll bankruptcy can take on your credit. Among the most common questions those looking to file for bankruptcy ask us here at Goldman & Beslow, LLC is how long after filing will they be able to qualify for a substantial loan (e.g. a mortgage). 

There may be no easy answer to that question. If you have a large enough of a down payment, lenders may be less concerned about loaning you money. That means that (in theory) you would only need to wait long enough to secure such a down payment. Yet given your need to file for bankruptcy, your ability to save enough money for a large down payment may be unlikely. 

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