Voorhees, NJ Bankruptcy Lawyer

Life can have all kinds of unexpected twists and turns. Sometimes what may have started out as an ambitious but manageable venture can suddenly get out of hand. For example, many restaurants that opened in late 2019 suddenly found themselves in circumstances they did not expect with the onset of the 2020 COVID-19 pandemic. When unexpected circumstances affect finances, debt can start to pile up. Debtors wanting to get paid can be relentless in their pursuit, and sometimes debt must be taken on to survive. If your debts have become too much for you to manage, filing for bankruptcy can give you some relief.

If you are considering filing for bankruptcy to help get control of your mounting debts, our lawyers can help you determine the best way to secure your and your family’s financial future. It can certainly be daunting to go through bankruptcy proceedings, but it can be very beneficial to your situation, and our lawyers will be there with you every step of the way.

For a free case review with our bankruptcy lawyers, contact Young, Marr, Mallis & Associates today by calling the number (609) 755-3115.

Terms to Know for Bankruptcy Proceedings in Voorhees, NJ

Like many areas of law, bankruptcy has some strange and sometimes antiquated terms that are not commonly used in everyday life. Because of this, people may not know what exactly is going on in bankruptcy proceedings, and confusion may result. Luckily, our lawyers have compiled a list of terms that are useful to know for bankruptcy proceedings.

Creditor and Debtor

The two parties involved in bankruptcy are called the creditor and the debtor. The debtor is the party that is in debt. In this case, that would be you. The creditor, sometimes also called the lender, is the party that is trying to collect payment from the debtor. While the creditor will go to court to try and get something like a wage garnishment to pay off debt, the debtor is the party that files for bankruptcy.

Liquidation

Liquidation is the turning of assets into cash. Money is sometimes referred to as “liquid” because it can be used for, broadly speaking, anything, whereas something like a house cannot easily be transferred and is therefore not liquid. A large part of bankruptcy is selling off nonliquid assets for cash. In this way, those assets are said to be liquidated.

Insolvent

When a party is insolvent, it means that it is unable to pay debts. Insolvency is a common reason that people file for bankruptcy.

Automatic Stay

An automatic stay is a key feature of bankruptcy in the United States. We will go into greater detail later, but it is essentially a way that the court instantly stops all debt collection efforts against you. This allows you to get a breather and figure out how things are going to proceed going forward.

Bankruptcy Explained

Many people have their own ideas – and probably some misconceptions – about what bankruptcy actually is. For many, bankruptcy appears as if a financial death sentence. It will result in nothing but destitution, and you will never be able to financially recover from it. Luckily, this is incredibly far from the truth of the matter.

The reality is that bankruptcy is more like an emergency reset button than an indicator of certain doom. The United States has bankruptcy lawyers that are extremely debtor-friendly. This is because, historically, people who were in debt went to prison for being in debt. This was not a beneficial system because the debtors ended up incarcerated and creditors did not get paid. Therefore, the United States strove to make bankruptcy a process that would benefit both parties. Debtors get to move on with a clean slate, and creditors get paid.

One of the most important features of bankruptcy in the United States is something called an “automatic stay.” This is a court order that immediately pauses and stops all debt collection efforts against you. Creditors can get in serious trouble for violating an automatic stay. Once the stay is in effect, the court works through one of a variety of bankruptcy Chapters in order to sell off assets in an orderly fashion and pay off as much of your debt as possible. Once assets have been expended or all debt is paid, you leave bankruptcy and move on with a clean slate.

When to File for Bankruptcy in Voorhees, NJ

Filing for bankruptcy is never easy and can be intimidating for some even to contemplate. However, filing for bankruptcy can provide you relief in many different situations and help you secure your financial future in Voorhees. Often, individuals considering filing for bankruptcy are reeling under mounting debt and aggressive collection attempts. Some might feel like they have no options or are concerned about how their reputation will be regarded if they do file for bankruptcy. Indeed, a common effect of filing for bankruptcy is a hit to one’s credit score, at least temporarily. While these feelings are valid, they should not stop you from taking control of your financial health. Deciding to file for bankruptcy is not only the right decision in most cases but also the responsible one.

Bankruptcy is provided by law because it is meant as an option to help those whose debts and financial commitments have overwhelmed them completely. The most common reason to file for bankruptcy in Vorhees is excessive debts. In many cases, people run into difficult times and must rely on credit to get them through challenging times. If you became ill or suffered an injury, you might not have had income for some time, sending you further into debt while you provide for your family. On top of all this, creditors can be notoriously zealous in their efforts to collect debts. They may call frequently, send numerous emails or regular mail items, or even show up at your house or place of business.

Those wanting to protect their assets from creditors might also find relief by filing for bankruptcy in Voorhees. Filing for bankruptcy can help by giving you some protection from collection attempts and additional lawsuits to claim your property, allowing you the time to plan how you will set your finances right. While bankruptcy might not protect all your property, it is much preferable to leaving your assets exposed to further legal action. Our Voorhees bankruptcy attorneys can help determine if filing for bankruptcy is the right option for you and your family.

Reasons People Might File Bankruptcy in Voorhees, NJ

Reasons for filing bankruptcy are as varied as the parties that petition the court for bankruptcy. However, our bankruptcy lawyers have compiled some common reasons that people file for bankruptcy in Voorhees.

Mortgage Failure

One of the more common reasons that people file for bankruptcy is because of a failed mortgage. For many people, their mortgage is one of their greatest expenses. When things go awry, it can become difficult to make payments on time that you used to be able to make no problem. If payments continue to not be made, you will likely default under the terms of the mortgage and be vulnerable to nasty consequences, like foreclosure. Filing bankruptcy and getting an automatic stay can prevent foreclosure proceedings from continuing.

Medical Debts

Unfortunately, many people in the United States are in debt for medical reasons. Even with health insurance, an unexpected serious injury can leave people hurting financially. Like many other kinds of debts, medical debt can be resolved through bankruptcy, and you can come out the other end with a clean debt slate and a clean bill of health.

Debt Lawsuits

Many people file for bankruptcy because they are being sued for debt they cannot pay. A common cause of this kind of lawsuit is unpaid credit card debt. However, unpaid loans or otherwise breaking payment agreements can also lead to these lawsuits. If you do not have the funds to deal with these debts, filing for bankruptcy may be a good option.

Bankruptcy Options Available in Voorhees, NJ

In New Jersey, there are two options that cover most individuals when filing for bankruptcy. Individuals can either file for Chapter 7 or Chapter 13 bankruptcy. Notably absent is Chapter 11 Bankruptcy. While Chapter 11 is indeed useful, it is more geared toward assisting businesses or corporate entities than individuals. Chapter 7 and Chapter 13 are far better suited to serving the needs of individuals. Each one has its own intended benefits, which can protect very different things. Which one you should file for will depend on the circumstances of your case, namely, what assets you might need to protect and the debts you wish to discharge. Our bankruptcy attorneys can review your case to determine the type of bankruptcy that suits your situation.

Filing for Chapter 7 Bankruptcy

Chapter 7 bankruptcy, also known as “liquidation bankruptcy,” is an option in Voorhees that many in financial trouble take advantage of. This type of bankruptcy is termed liquidation because the individual’s assets are sold to help satisfy their debts. Chapter 7 bankruptcy is available to individuals but also some smaller businesses that are struggling with debt.

Filing for Chapter 7 bankruptcy can provide relief quickly, which is one of its main advantages. During this process, some of your property will be sold off, or “liquidated,” while certain other debts will be discharged. The major disadvantage of filing for Chapter 7 bankruptcy is that the property sold might not be the property you want to lose. This can include cars, homes, and anything else valuable enough to help satisfy your debts.

Chapter 7 bankruptcy is most appropriate in cases where the individual filing for bankruptcy owns relatively little property but has an extreme amount of debt. However, you must pass a means test to qualify for Chapter 7 bankruptcy. This test assesses your annual household income and compares it with the average New Jersey household income. If your income is lower than the state average, your Chapter 7 bankruptcy filing will be accepted. However, any income your spouse earns, dependents you claim, and other economic factors will be used to determine your average household income. Our bankruptcy lawyers can help you prepare your Chapter 7 bankruptcy filing if it is the best option to help you out of debt.

Filing for Chapter 13 Bankruptcy

The other option in Voorhees is filing for Chapter 13 bankruptcy. Chapter 13 bankruptcy is best suited for individuals with assets they do not want to be sold off to satisfy their debts. Unlike Chapter 7 bankruptcy, your property is not liquidated to pay down your debts under Chapter 13 bankruptcy. You can typically keep your property if your Chapter 13 bankruptcy filing is approved, but you will need to develop and submit a detailed repayment plan that illustrates how you will make good on your debts.

Most repayment plans range from two to five years, depending on the individual’s circumstances. However, the court has the final say in whether your repayment plan is feasible.  If, after reviewing your personal finances and household income, the court determines that you will likely miss a payment at some point, it will reject your Chapter 13 bankruptcy application. Thus, it is critical to ensure that all your finances have been properly reviewed and identify and address potential concerns down the road. Our bankruptcy attorneys can help you determine if Chapter 13 bankruptcy is suitable and draft a repayment plan that is sure to help pull you out of financial danger.

Our Voorhees, NJ Bankruptcy Lawyers Can Help

Call Young, Marr, Mallis & Associates at (609) 755-3115 for a free case assessment from our bankruptcy lawyers.