Elizabeth, NJ Bankruptcy Lawyer

For people facing some sort of financial hardship, the term “bankruptcy” can create a real sense of fear. The term is often used as shorthand for financial irresponsibility and failure. However, the reality is that bankruptcy represents anything but that. Bankruptcy is a way for people who are struggling financially to get some breathing room and move on to the next chapter of their life.

If you are considering filing for bankruptcy, you should speak with our lawyers. We have helped many clients through the bankruptcy process, and we have the experience, dedication, and professionalism to give you the representation you need from legal counsel when dealing with bankruptcy proceedings.

For a free, no-obligation discussion of your case, call Young, Marr, Mallis & Associates’ bankruptcy lawyers at (609) 755-3115.

What is Bankruptcy in Elizabeth, NJ?

There are a lot of misconceptions about bankruptcy. Many people see it as a sign that someone has failed spectacularly in a financial endeavor or is just bad at managing money. However, that is far from the truth.

Historically, people who went into debt were sent to prison if they could not pay. When people set up their own government in the United States, they wanted to do away with the system. Thus, bankruptcy laws in the United States are focused on working out a solution that is both good for the lender and the debtor, not on punishing anyone.

The key feature that allows bankruptcy in the United States to work this way is something called an “automatic stay.” This feature is, as the name would suggest, automatically put in place when you file for bankruptcy. What it does is immediately stop all debt collection efforts against you. This means no more debt collection calls, solicitations, or nasty emails from creditors. It also means that all efforts to resolve debt, like foreclosure proceedings, immediately stop. This allows the debtor to get some much-needed breathing room and figure out how they are going to deal with bankruptcy.

Parties Involved in Elizabeth, NJ Bankruptcy Proceedings

There are some key parties involved in bankruptcy proceedings. Knowing what these parties do can help you feel more comfortable with what is going on during bankruptcy proceedings.


The debtor in bankruptcy proceedings is the individual who owes a debt to the creditor, who is the entity that is trying to collect the debt. Generally, you will be the debtor, and a bank or other institution with a lot of financial capital will be the creditor.

Bankruptcy Trustee

A bankruptcy trustee is somebody who is put in charge of a “bankruptcy estate” during bankruptcy proceedings. The bankruptcy estate refers to all the things that the debtor has an interest in at the time of filing for bankruptcy.

Bankruptcy trustees are appointed under both Chapter 7 and Chapter 13 bankruptcy. Their job is to work for the creditors and make sure that assets are distributed according to the order of priority that the creditors have. The bankruptcy trustee is also the entity responsible for deciding which assets get liquidated and which do not. However, they cannot touch assets that are considered exempt from bankruptcy proceedings.

Chapters of Bankruptcy in Elizabeth, NJ

Bankruptcy has different “chapters” that you can file under. These chapters are catered to individuals and entities with different needs. The most infamous chapter is, of course, Chapter 11 bankruptcy. This is the chapter that major companies and corporations file under when they want to restructure or are calling it quits. However, that chapter is geared towards large companies, not people. Therefore, you may want to file with our bankruptcy lawyers under a different chapter. The two most common chapters that individuals file bankruptcy under are Chapter 7 bankruptcy and Chapter 13 bankruptcy.

Chapter 7 Bankruptcy

Chapter 7 bankruptcy is one of the most straightforward and quickest chapters of bankruptcy. Under this chapter, the debtor liquidates assets until either all debts are paid off, or there are no assets left. At that point, bankruptcy proceedings end, and the debtor emerges with a clean slate, free of debt or financial obligations. It does not matter whether all of the credit debts are paid or not. Once bankruptcy ends, the former debtor has turned a new leaf.

The speed and efficiency of Chapter 7 bankruptcy, however, does not come without its downsides. The greatest downside of Chapter 7 bankruptcy is that pretty much everything is up for grabs. There are very few assets that can be said to be “off limits” for creditors to take. Pretty much anything can be “liquidated” or sold for cash. The term comes from money being known as a “liquid” asset because it can easily be moved around or turned into something else. Because so many things are able to be liquidated, Chapter 7 bankruptcy is best suited for individuals with few assets, or alternatively, few assets that they want to retain.

Chapter 13 Bankruptcy

Chapter 13 Bankruptcy is, in many ways, the opposite of Chapter 7 bankruptcy. Instead of moving very quickly like Chapter 7 bankruptcy, Chapter 13 is focused on letting a debtor pay off their dues over a period of years. While this means that bankruptcy proceedings will take longer, the benefit is that you can earmark certain assets as “off limits” from liquidation. Accordingly, Chapter 13 bankruptcy is a good chapter to file under for individuals who want to hold on to certain assets and have a steady source of income from which to pay off debts during bankruptcy proceedings.

Talk to Our Elizabeth, NJ Bankruptcy Lawyers About Your Case

For a free discussion of your situation, call (609) 755-3115 and talk to our bankruptcy lawyers with Young, Marr, Mallis & Associates.

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