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. Being a creation of federal law, bankruptcy will go through federal courts. Accordingly, the process for filing for bankruptcy in New Jersey is essentially the same as the process anywhere else in the United States. However, particular courts in Medford, New Jersey will have individual rules for exemptions, so you should speak with a local attorney before filing.
Chapter 7 Bankruptcy in Medford, New Jersey
There are 2 main forms of consumer bankruptcies in Medford, New Jersey: Chapter 7 and Chapter 13 bankruptcy. Chapter 7 liquidates part of the debtor's assets. It requires a certain percentage of the debtor's assets to be sold off to pay as much of his or her debt as possible. However, many forms of property that most people own are exempt, meaning that they don't need to be sold. This often includes houses, vehicles, insurance policies, and essential personal items, like clothing. These assets are not available to creditors.
Once eligible assets are sold, and the proceeds turned over to the creditors, most remaining debt is excused. However, some forms of debt cannot be discharged in bankruptcy, including student loans, taxes, child support, personal injury awards, and fines. If most of your debt in Medford, New Jersey is not dischargeable, you may want to consider other options besides bankruptcy.
Chapter 13 Bankruptcy in Medford, New Jersey
In Medford, New Jersey, chapter 13 is extremely different from Chapter 7, and may or may not be the best option for you, depending on your situation. 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 Medford, New Jersey
Chapter 13 is usually a good option for people who have a stable income, and a large amount of non-exempt property that they can't part with. On the other hand, if most of the debtor's property is exempt, and he or she does not have a stable income, Chapter 7 might be more beneficial.
In any case, you should talk with a local Medford, New Jersey bankruptcy Lawyer. Your Lawyer can advise you of your options and inform you of their likely consequences. This will make it much easier for your to make an informed choice.