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Chapter 7 Bankruptcy

A woman who needs help filing for chapter 7 bankruptcy in New Jersey"

Chapter 7 Bankruptcy in New Jersey

Are you avoiding the telephone at home because creditors are constantly calling? Is your mailbox full of past due notices and demands for payment? Chapter 7 bankruptcy may be the answer for you.

Chapter 7 bankruptcy allows you to make a fresh financial start, digging you out of the mountain of credit card, medical or other bills that have you stressed and worried about how you are going to get them paid.

What is Chapter 7 Bankruptcy?

A common question asked by others like you who are facing financial difficulty is “what is Chapter 7 bankruptcy?” Under Chapter 7, debts are eliminated through what is known as “discharge,” making you no longer legally obligated to pay them.

The official Chapter 7 bankruptcy definition is a “legal liquidation proceeding.” What this means is that any assets determined to be nonexempt may be sold in order to pay your creditors. However, Chapter 7 also offers you significant protections.

What Debts Can Be Discharged?

Under Chapter 7, any unsecured debt may be eliminated under federal law. Unsecured debt is anything debt you did not use collateral to guarantee payment on the account.

Credit cards, medical bills and payday loans are considered unsecured debt. In addition, you may also be able to discharge past-due rent or utility bills as well as some types of tax debt.

Bankruptcy Protection

One of the most important protections provided under the Chapter 7 bankruptcy definition is what is known as an automatic stay. Under the automatic stay, creditors are no longer permitted to call, send debt collection letters, file lawsuits or garnish your wages as soon as you file for bankruptcy.

This can immediately reduce your anxiety and stress as harassing creditors are no longer permitted to contact you.

How It Works

Once it has been determined that you are eligible to file Chapter 7, your attorney will prepare court documents that outline our income, debts and assets. A trustee is appointed by the court to oversee your case and it is their job to be sure that any assets available are distributed to your creditors.

You will not lose everything you own in a bankruptcy, however, as some items are exempt from seizure by the court. Your clothing, furnishings and tools you use as part of your employment are exempt as is a vehicle valued up to a certain amount and some of the equity in your home. Some states offer what is known as a wild card exemption that allows you to protect some of our nonexempt property as well.

Creditors have up to 60 days to object to the discharge. Any creditor who violates the automatic stay could suffer court sanctions, including paying you for the violation.

If you or a loved one is dealing with constant collection calls, Chapter 7 may be the answer for you. There are requirements to file Chapter 7, so it is critical that you contact a qualified attorney who can review your circumstances and advise you on the best path to take. Learn more by calling us today or filling out our contact form.

This chapter of the Bankruptcy Code provides for ``liquidation`` - the sale of a debtor's nonexempt property and the distribution of the proceeds to creditors.

Update March 22, 2020: We are fully operational at this time as we are able to continue working remotely and filing electronically. Contact us today to schedule a meeting or consultation via video chat.