If you’re considering filing Chapter 13 bankruptcy in New Jersey, it is important that you also understand the implications and your requirements. Missing any of the responsibilities can void your bankruptcy case.
What is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy is a method of getting rid of your debt by entering you into a repayment plan. A Chapter 13 Bankruptcy groups your debt into a single, affordable monthly payment. The court then determines a fair payment to make each month, to which they then divide between each of your creditors.
In most cases, people will pay into Chapter 13 Bankruptcy for three to five years before the case is dismissed. As long as you follow all requirements, any leftover debt may be canceled.
Chapter 13 Bankruptcy Responsibilities
If you qualify for Chapter 13 Bankruptcy in New Jersey, you will be subject to the following responsibilities:
- You must continue paying all regular bills when due
- You must make monthly payments to your Chapter 13 Trustee
- If you want to sell any assets during Bankruptcy, you must receive approval
- If you plan on using a real estate broker or refinancing, you must receive approval
Chapter 13 allows people to get rid of costly debt. However, it does require that you continue to make monthly payments and that you receive approval before any big changes, like selling or refinancing your house.
Is Chapter 13 Right For You?
If you have decided that bankruptcy is the right choice for you, you may be considering Chapter 13. It is important to not only consider Chapter 13, but other bankruptcy plans that you may be eligible for, to ensure that you choose the one that is right for your financial situation. Chapter 13 bankruptcy may be a good choice if you have a steady income but your debt payments have gotten too costly.
Some people may also not be eligible for Chapter 7, making Chapter 13 Bankruptcy the only option. Even if you qualify for both, you may still decide that Chapter 13 bankruptcy is right for you. Chapter 13 bankruptcy allows you to catch up on debt payments, and in some cases, keep your assets. This means that you may be able to hold onto your vehicle, even if you are behind on payments.
Chapter 7 also does not include certain types of debt, like tax and domestic support debts, meaning Chapter 13 Bankruptcy may be a good choice for you if you are behind on these types of debt. Both types of bankruptcy also have considerations. Each will impact your credit score, so if you have plans of buying a house soon, it may not be the right decision for you.
Need Bankruptcy Assistance?
Understanding the eligibility and filing requirements of both bankruptcy options is not easy. If you have questions about your eligibility or which is right for you, it may be beneficial to reach out to a bankruptcy lawyer. A bankruptcy lawyer can help you consider the elements of your case and choose the right program.
Contact a Paterson Bankruptcy Attorney for a Consultation About Chapter 13 in New Jersey Today
If you are struggling with debt, you may need a fresh start financially. An experienced bankruptcy and debt relief attorney can help you explore your options and determine the best course of action for you, your family, and/or your business. The experienced New Jersey bankruptcy lawyers at the Law Office of Silverman & Roedel understand the nuances of New Jersey and federal bankruptcy laws, so we can help you protect your interests. Call us anytime at (973) 772-6411 or fill out the online contact form to schedule a confidential consultation. We have an office conveniently located at 1187 Main Avenue, Suite 2C, Clifton, NJ 07011.
The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.