Filing bankruptcy in New Jersey may be confusing and leave you with plenty of questions. It's important that you understand the most basic concepts regarding the bankruptcy procedure before you consult a lawyer in order to keep your costs down. After all, there's no use paying for a lawyer if bankruptcy ends up not being right for you.
What is Chapter 7 bankruptcy?
When you declare Chapter 7 bankruptcy in New Jersey, you will be relieved of most of your debts and given a discharge which prevents your creditors from seeking any more payments from you. All non-exempt property that you own will be taken from you in order to pay off your creditors. The good news is that you will find that most of your property may be declared exempt.
What property is exempt?
Every state has their own laws when it comes to exemptions. When you declare bankruptcy in New Jersey, you can expect to declare the following types of property as exempt: your home up to $17,425 in equity, disability and unemployment payments, life insurance policy up to $9,300 in loan value, alimony, child support, most pensions and IRAs, and personal items such as clothing, books, furniture, household goods, musical instruments, and others up to $450 per item, with a total of $9,300. See your lawyer for a more complete list.
What debts cannot be discharged?
As mentioned earlier, not all debts can be discharged when you file for bankruptcy in New Jersey. In most cases this includes: back taxes, alimony, child support, student loans, government fines, and any debts that you do not have listed in your bankruptcy petition. This is why it's important to include all debts in this petition before filing for bankruptcy.
What information do I need to file for bankruptcy?
Before you fill out your petition and other paperwork, you will need to gather up all the information that is needed in order to fill out the forms. This information usually consists of the following: a complete list of the names of your creditors and how much you owe each of them, a list of all secured and unsecured debts, unsecured priority claims, unexpired contracts and leases, list of ownership in real estate, amount of any mortgages, location of property such as bank accounts, household goods, furnishings, pensions stocks, IRAs, and the cash value of any insurance polices that you may have. Consult with a bankruptcy attorney if you would like to get more information.
