Filing for bankruptcy in New Jersey doesn’t mean that you have to lose everything. However, you should be prepared to give up some of your non-exempt assets. If a judge rules that you can live without it, a trustee might sell it to pay off your debts.
What is considered a non-exempt asset?
When you file for Chapter 7 bankruptcy, the judge doesn’t expect you to give up your house, vehicle and everything else that you need to survive. Important assets like these are typically classified as exempt assets. Your trustee can’t sell off these assets to pay off your creditors regardless of the situation.
However, your trustee can sell off non-exempt assets that you don’t necessarily need to survive. This could include second vehicles, extra properties, artwork, jewelry, collectibles, certain investments and other assets. Federal laws and state laws have different definitions for non-exempt assets. If federal laws would make you give up a greater share of your assets, you could go with state laws.
Your bankruptcy attorney might point out that filing for bankruptcy doesn’t automatically mean you have to give up your assets. If you don’t have any non-exempt assets, you might simply have a “no asset” case. This means that a judge could discharge your debts without payment.
Is bankruptcy worth the hassle?
Filing for bankruptcy can be stressful at times. However, bankruptcy also means an end to harassment from your creditors, wage garnishments and past-due bills showing up in the mail. You may be able to discharge the majority of your debts even if you don’t have any non-exempt assets to sell. Your attorney may help you figure out the best option that allows you to keep most of your assets, get debt collectors off your back and start over with a fresh slate.