Middlesex County, NJ Bankruptcy Lawyer
Individuals often face crises in their lives, from severe medical conditions to loss of a job. The consequences of these events can be far-reaching, potentially causing a significant financial strain on limited resources. When confronted with overwhelming economic burdens, many people do not know where to turn. At Young, Marr, Mallis & Associates, our compassionate Middlesex County bankruptcy attorneys recognize the hardships associated with extreme financial stress. We also know that bankruptcy can often provide relief for individuals and families who need a solution.
Bankruptcy can be a powerful means to address your financial hardship. At Young, Marr, Mallis & Associates, our New Jersey bankruptcy lawyers have over twenty years of experience serving our clients with care and respect. Call Young, Marr, Mallis & Associates, at (609) 755-3115 to speak with an attorney. Your initial consultation is completely free.
First Steps in Filing for Bankruptcy in Middlesex County, NJ
Before considering bankruptcy, you should understand the benefits and drawbacks of the various types of bankruptcy. Additionally, you should decide what goals you have, such as eliminating debt or saving your home from foreclosure.
During your initial consultation, our seasoned bankruptcy attorneys will evaluate your financial situation and thoroughly analyze your income, assets, and goals. They will also explain how the two chapters of bankruptcy for individuals work. We realize that the process can appear complicated and foreboding. Still, we are dedicated to providing you with enough information to make an informed, confident decision regarding your bankruptcy filing.
Filing for Chapter 7 in Middlesex County
Many people prefer filing for Chapter 7 because it is fast. From filing to discharge, it usually takes five to six months to complete, requires no monthly payments to creditors, and eliminates most debt. While Chapter 7 has many benefits, it does have some disadvantages, and your income must qualify under very restrictive guidelines.
To qualify for Chapter 7, you must pass the Means Test. This official bankruptcy form calculates your household income from the last six months. It excludes some expenses such as mortgage payments, and it uses some fixed deductions based on geographical location and family size. This test determines whether you qualify to file under Chapter 7. Our experienced attorney will use documents you provide to complete the Means Test, guiding you through the process so you understand how it affects your ability to file.
Chapter 7 is known as “liquidation bankruptcy.” This means there is a requirement to sell some of your property through a court-appointed trustee. The money from the sale is used to satisfy some or all of your creditors. While this appears to be a clear disadvantage, the Bankruptcy Code has many exemptions our attorneys can use to protect some assets from being sold. In New Jersey, a debtor can choose either the federal or state exemptions.
It is essential that you work with an experienced bankruptcy lawyer to help you pick the best set of exemptions. Once your case is filed, you cannot switch from one set of exemptions to the other.
Reasons to File for Chapter 13 in Middlesex County
Chapter 13 is a powerful tool if your home is in foreclosure or scheduled for a sheriff’s sale. Filing bankruptcy will stop all collection actions against you, including any legal proceedings, through a legal tool called an “automatic stay.” An automatic stay puts up a legal wall between you and all of your creditors, prohibiting bills, phone calls, automatic deductions, and legal proceedings, including a scheduled sheriff sale.
One of the key differences between Chapter 7 and Chapter 13 is the bankruptcy plan. Chapter 13 is a “repayment bankruptcy” that requires you to pay back some or all of your debt. Our seasoned Middlesex bankruptcy attorneys will review all of the factors used to determine your monthly bankruptcy plan payment.
The type of debt you have is one factor in determining how funds are distributed through your bankruptcy plan. If you filed to stop a sheriff sale, then the amount you are behind on your mortgage loan will have to be paid through the plan to keep your home. However, you will still have to make regular monthly mortgage payments directly to your lender on top of the bankruptcy plan payments.
Your total monthly income will affect the amount you will have to pay to your creditors. Not unlike the Chapter 7 Means Test, Chapter 13 requires a calculation to determine how much you have available in disposable income to allocate to unsecured debt. This still might be an advantageous option as your creditors cannot negotiate how much they will receive. For example, if you have $75,000 in unsecured debt and are required to pay $20,000 over the next five years, the remaining $55,000 will be discharged at the end of your case. Unlike with debt that your creditors forgive, you do not have to pay income taxes on debt is eliminated through bankruptcy. At Young, Marr, Mallis & Associates, our commitment is to ensuring that your Chapter 13 is as beneficial as possible.
For a Free Consultation, Call Our Middlesex County, NJ Bankruptcy Attorney
If you are considering bankruptcy because of the stress of overwhelming debt, call the experienced Middlesex County bankruptcy lawyers at Young Marr & Associates. We will provide you with the respectful representation you deserve. We recognize that bankruptcy is complicated and will work closely with you to help you understand each step of the process. Call (609) 755-3115 to speak with an attorney and schedule a free, confidential legal consultation.