Bankruptcy is a court proceeding which lets a person or business have some or all of their debts discharged. It should usually only be considered as an option of last resort, because it can have significant long-term consequences, even if it can stave off financial disaster. This means that the costs and benefits need to be carefully considered before filing. Bankruptcy is controlled by federal law, and proceeds in federal courts. So, the process for filing for bankruptcy in New Jersey will be very similar to the process everywhere else in the U.S. However, individual bankruptcy courts have different rules for exemptions, so it might be a good idea to consult with a local lawyer in Brick, New Jersey before filing.
Chapter 7 Bankruptcy in Brick, New Jersey
There are 2 common forms of bankruptcy in Brick, New Jersey. They are known as Chapter 7 and Chapter 13 Bankruptcy. Chapter 7 bankruptcy involves a liquidation of some of the debtor's assets, which pays off part of his or her debt. Once this is done, the remaining debt is discharged. Fortunately for debtors, many forms of property are exempt from liquidation, including homes, vehicles, essential personal items, and retirement accounts.
Once all non-exempt assets are sold, and the money from the sales turned over to the creditors, most remaining debt is discharged. But some forms of debt cannot be discharged through Chapter 7 bankruptcy. These include child support payments, student loans, and criminal fines, among others. If most of your Brick, New Jersey debts are not dischargeable, you may want to consider options other than bankruptcy.
Chapter 13 Bankruptcy in Brick, New Jersey
Chapter 13 bankruptcy in Brick, New Jersey is markedly different. It may or may not be a better option than Chapter 7, depending on the facts of your particular case. Chapter 13 Bankruptcy involves a court setting up an altered payment plan, which allows the debtor to pay off most or all of his debts over a longer period of time, through monthly payments that should, assuming that the debtor is willing to make a few sacrifices, be manageable.
Which Type of Consumer Bankruptcy Should I File in Brick, New Jersey
Whether Chapter 7 or Chapter 13 is the right choice for you depends heavily on your individual situation. If you have a stable income stream, and a lot of non-exempt property, Chapter 13 might be right for you. If you don't have a stable income, and most of your property is exempt, Chapter 7 might be a better way to go.
Whatever your situation, you should speak with a local Brick, New Jersey bankruptcy lawyer. Your attorney will be able to advise you of your options and their likely consequences, which will help you make a more educated decision.