The following is a short list of common glossary terms for bankruptcy. If you have further questions, please contact our New Jersey bankruptcy attorneys at Goldman & Beslow by calling our office.
Automatic stay: An injunction that stops all harassing calls and letters from creditors as soon as the bankruptcy is filed. It also stops repossession, foreclosure, lawsuits and garnishments against the debtor.
Bankruptcy: A legal method of discharging debt under the Bankruptcy Code.
Bankruptcy court: A unit of the federal judicial district courts. Bankruptcy judges only hear bankruptcy cases or issues related to bankruptcy.
Bankruptcy estate: All legal or equitable interests, properties and assets owned by the debtor at the time of the bankruptcy filing.
Bankruptcy judge: A judicial officer of the United States district court who has decision-making power in bankruptcy cases.
Bankruptcy petition: The document filed by the debtor or debtor’s attorney, which opens the bankruptcy case.
Chapter 7: Also known as “liquidation bankruptcy” because the debtor’s nonexempt property is sold to pay back his or her creditors.
Chapter 13:Also known as “consolidation bankruptcy” as it consolidates the debtor’s outstanding debts into a reasonable monthly payment to be paid over three to five years, with a discharge of remaining eligible debts at the end.
Creditor: Person or entity to whom the debtor owes money.
Credit counseling: The individual or group briefing that debtors must participate in prior to filing for any form of bankruptcy, administered by an approved nonprofit budget and debt counseling agency.
Debtor: The person or business who is in debt and filing for bankruptcy.
Deficiency: The amount a debtor owes on the loan that was not paid prior to bankruptcy or the difference between the amount of a loan on a property and the property value.
Discharge: The elimination of all dischargeable debt at the completion of a bankruptcy. The discharge also prevents creditors from attempting to collect on the discharged debts and from contacting the debtor regarding those debts.
Dischargeable debt: Debt that is eligible for elimination under the Bankruptcy Code, including credit card debt, medical debt, mortgages and other loans.
Exemptions or exempt property:Property and assets that the debtor is allowed to keep under the Bankruptcy Code. There are federal and state exemptions available to the debtor, but only one set of exemptions may be used in a bankruptcy. New Jersey allows the debtor to choose which set he or she will use.
Financial management course: An instructional course in personal financial management that debtors in Chapter 7 and Chapter 13 bankruptcy cases must participate in prior to their discharge. This can be done online or over the phone.
Lien: The right to take and hold or sell the property of a debtor as security or payment for a debt.
Means test: A measure of a debtor’s income to determine if he or she qualifies for Chapter 7 bankruptcy according to state income levels.
Motion to lift the automatic stay: A request by the creditor to take action against the debtor or the debtor’s property that would otherwise be prevented by the automatic stay.
Nondischargeable debt: Debts that are not dischargeable in bankruptcy, including child support, spousal support (alimony), student loans and taxes that are not more than three years old. This may also include repayment of moneys received by fraud or that were incurred as part of a divorce decree or restitution for a crime.
Reaffirmation agreement:An agreement between the debtor and a creditor in a Chapter 7 bankruptcy, for the debtor to continue paying a dischargeable debt, such as a car loan, in order to keep the property.
341 meeting: The meeting between the debtor and the Trustee after the petition has been filed with the courts.
Trustee: The representative of the bankruptcy estate, appointed by the bankruptcy courts. The bankruptcy trustee reviews the debtor’s schedule and petition as well as the plan in Chapter 13 bankruptcies. It is his or her job to liquidate any available assets in a Chapter 7 bankruptcy and to administer any payments to creditors in all bankruptcies.
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.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.