Bankruptcy and Divorce

Although couples decide to get divorced for many reasons, disagreements over money and finances are one of the main reasons that people file for divorce in New Jersey, if the issue is the mismanagement of money, filing for bankruptcy and divorce simultaneously can be a dangerous combination if the individuals involved are not well informed. A couples' marriage and their finances go hand in hand. Most married couples share a residence, hold joint bank accounts, share jointly owned vehicles, share credit cards, and incur shared expenses. Therefore, in the event that a couple is contemplating a divorce and a bankruptcy at the same time, the process can become very complex. Filing for either a Chapter 7 or Chapter 13 bankruptcy or getting a divorce are each stressful and arduous processes by themselves, but combining both may seem unimaginable to some. Therefore, it is imperative that individuals who find themselves in this situation make sure that they are well informed about both divorce, bankruptcy, and the affect that one has on the other - before engaging the processes. First, the couple will need to decide whether they wish to file for bankruptcy prior to the divorce proceedings or following them. If the spouses file for bankruptcy before their divorce, they will have the option to file either jointly or singly. By doing this, the couple will be compelled to present the court and the bankruptcy trustee with all of their financial information - such as assets and other property. In the vast majority of cases, most of the couples' assets will be exempt, but non-exempt assets will become part of the bankruptcy estate and the uncertainty of their discharge may make divorce property settlement negotiations more difficult. Alternatively, filing for bankruptcy may settle many debt or property issues between the couple before divorce negotiations even begin, thereby easing the process. If a couple can anticipate an amicable divorce it may be within their best interest to file for bankruptcy before filing for divorce for this aforementioned reason, as issues regarding ownership and title of property will be settled during the bankruptcy. If the couple realize early in the process that their divorce will be contested by either or both spouses, they may want to distribute the marital assets first, through negotiation and agreement, and then deal with each of their respective debts later. If you have any questions regarding how filing for bankruptcy and divorce will affect each respective process, it is critical that you seek out the advice of an experienced bankruptcy attorney to assist you with your finacial issues and to advise you properly in regard to bankruptcy. For more information regarding Chapter 7 bankruptcy, Chapter 13 bankruptcy, foreclosure or any other consumer debt issues visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and not intended to replace the advice of an attorney.

Foreclosure- Is Bankruptcy the Answer?

Debtors filing for Chapter 7 bankruptcy in New Jersey may be surprised to learn that even after they file for bankruptcy their homes can, and in many instances will, still be foreclosed upon by their lending banks. Most people file for Chapter 7 bankruptcy to discharge all or most of their debt, but filing for Chapter 7 bankruptcy does not automatically or necessarily allow a debtor to keep his or her home. Beyond this, even if a mortgage is one of the debts that is discharged upon the bankruptcy filing, the lender still retains the right to come in at a later time and re-possess the debtor's home. Typically, a bank or similar lender will re-possess a debtor's home using a deed in lieu of foreclosure or by a judicial or non-judicial foreclosure proceeding. A deed in lieu of foreclosure is used when a debtor relinquishes all of his or her interest in the home to the lender. This method reflects slightly better than a foreclosure on the debtor's credit report. A judicial foreclosure occurs when a bank petitions the court system to be awarded the legal right to take back a debtor's residence and/or property. In a non-judicial foreclosure, a bank will sell the debtor's property at a foreclosure auction without the need to petition a court for the right to do so. Although, in a non-judicial foreclosure, the lending bank must still abide by the New Jersey statutory foreclosure process before it can re-possess and sell a debtor's home at an auction. In some bankruptcy cases, the lending bank will not attempt to re-possess or sell the debtor's home until the bankruptcy proceedings have concluded. On the other hand, many banks will immediately petition the court to remove a debtor's home from the stay of bankruptcy protection so that foreclosure proceedings can commence. In New Jersey, bankruptcy laws are very complicated, therefore it is critical that debtors seek out the advice of an experienced bankruptcy attorney to assist them with bankruptcy matters. For more information regarding, Chapter 13 bankruptcy, Chapter 7 bankruptcy, foreclosure or other consumer debt issues in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and not intended to replace the advice of an attorney.

Options For Chapter 13 Debtors Who Cannot Make Re-Payments

Chapter 13 debtors who cannot make their required re-payments have options to assist them from becoming delinquent. The purpose of a Chapter 13 Bankruptcy is the re-organization of debts and assets and the judicial institution of a re-payment plan to allow a debtor to remain in possession of his or her assets. Since under Chapter 13, a debtor has the opportunity to potentially keep their property and/or assets it is an attractive option for many people facing debts that they have been delinquent in paying. Unfortunately, filing a Chapter 13 Bankruptcy petition may not be feasible for everyone facing substantial debts that he or she cannot pay. The Bankruptcy Court will not allow a debtor to proceed with a Chapter 13 petition unless the debtor can provide sufficient proof to the bankruptcy trustee that he or she is earning enough of an income to cover the court's mandatory monthly re-payment amounts. If a married couple reside together, both partners have to include their income and expenses on the Chapter 13 petition, despite who actually filed the petition. Further, any other individuals who live in the same household must also include his or her income and expenses on the petition. In the event that the debtor does not have enough household income to make the monthly payments to the trustee, the trustee may allow a non-household person, such as a relative or close friend, to make income contributions to assist the debtor in making his or her required monthly payments. Typically, a trustee will require that the person who is making income contributions to the debtor sign a legal document stating his or her intent to contribute a certain amount or a certain duration of time. Additionally, the individual who is making contributions will most likely have to submit proof of his or her earnings. If you are facing or considering bankruptcy the options and obligations can become confusing very quickly. Rather than making a life-changing decision without understanding your choices, you should consult with an experienced Bankruptcy attorney to gain more information or assistance with your individual situations. For more information about Chapter 13 Bankruptcy, Chapter 7 Bankruptcy, debt relief, consumer debt, foreclosure or other bankruptcy matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes and in no way intended to replace the advice of an attorney.

Abandonment of Property By Bankruptcy Trustee

A Bankruptcy Trustee moved to sell the property of a debtor and the debtor cross-moved to compel abandonment of the property based on the debtor's reported transfer to another. Under Section 11 U.S.C. 554(b) of the Bankruptcy Code, the court may, upon request of an interested party and notice of hearing, "order the Trustee to abandon any property of the estate that is burdensome to the estate or that is of inconsequential value and benefit." The burden is on the party seeking to compel abandonment to show the property meets the criteria for abandonment. If the burden is met, then the burden shifts to the Trustee to show that the property is of value and can be utilized to satisfy a debt of the bankruptcy estate. The debtors in the matter of In re Taggart sought abandonment on the grounds that the real property was not part of the bankruptcy estate according to Bankruptcy Code Section 541(d) and that, if the real property is deemed to be property of the bankruptcy estate, a constructive trust should be imposed in favor of the disputed buyers. The debtor, Raymond Taggart, claimed the property was transferred to his brother and sister-in-law, Dennis and Kathleen Taggart, brother and sister-in-law of the debtor, prior to filing bankruptcy. Under the law, Raymond Taggart was without rights to transfer the property without assent of the mortgage holder. The Taggart's second argument was that a constructive trust in favor of the alleged buyers, Dennis and Kathleen should be imposed post-petition. Under Section 544(a) the trustee has power to avoid any transfer by the debtor or any voidable obligation incurred by the debtor. The Taggarts could not provide evidence they were bona fide purchasers for value and had not recorded any deed transfer. At best there was an agreement of sorts between brothers and perhaps there was intent to transfer the property to Dennis upon payment in full of the mortgage. Even if transfer to Dennis upon full payment was the intent, Dennis and Kathleen could have taken steps to obtain their own mortgage on the property in order to pay off the mortgage taken by Raymond. As long as Dennis and Kathleen could not obtain a mortgage, Raymond was not unjustly enriched by their payment of the carrying costs because it could be considered rent. For the foregoing reasons, the court finds that there was no basis to impose a constructive trust and the trustee was not required to abandon the property but rather could sell it for the benefit of the unsecured creditors. The manner in which property is titled and used by the debtor can affect the treatment of such property in the event the debtor files for bankruptcy. Knowing how your assets are likely to be treated in bankruptcy often makes a critical difference in the decision of whether to file. If you are considering bankruptcy you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

Reaffirmation Lets You Keep Your Car After Bankruptcy

If you have a vehicle and are filing for bankruptcy, you may want to reaffirm the lease/loan so that you can keep the vehicle. Many people hesitate on filing for bankruptcy because they do not know what will happen to their car which is their primary means of getting around. People who have continuing and steady income may have the ability to repay their debts when a repayment plan is established allowing them to retain their vehicle under a Chapter 13, referred to as a reorganization bankruptcy. When people file for Bankruptcy under Chapter 7, known as a liquidation bankruptcy, the "non-exempt" assets are liquidated and the proceeds used to pay their debts. Eligible debts which cannot be paid are then discharged. If the eligible debt is secured by a vehicle then upon discharge the creditor will get the vehicle back. The Debtor has the option however of reaffirming the lease or loan which then becomes a new contract, which cannot be withdrawn. Through reaffirmation, the debtor enters into a new contract with the creditor to make payments in exchange for retaining the vehicle. Assumption of a vehicle lease or loan may or may not be allowed by the bankruptcy court, especially if it is a lease or loan payment that is not affordable. Assumption may be beneficial under certain circumstances. If the payments on the vehicle are current and the interest rate and the monthly payments are low and affordable which may not be available if dealing with a new creditor right after a bankruptcy. If it is a lease and the purchase price of the vehicle at the end of the lease contract is reasonable then an assumption may be beneficial. However, you may be better off walking away from the unexpired lease and allowing the vehicle to be taken if the permissible amount of mileage was exceeded and you cannot afford to catch up on the missed payments. If you are thinking about filing bankruptcy you should consult with an experienced foreclosure attorney immediately in order to protect your rights. For more information regarding bankruptcy and reaffirming your vehicle loan or lease, foreclosure, or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and is in no way intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

Daughter Not Liable For Student Loan Taken By Father On Her Behalf

Creditor could not hold a former student liable for repayment of a student loan applied for by the former student's father (debtor) who was obligated under his Property Settlement Agreement at the time of his divorce to pay for her college expenses. Creditor produced loan documents which listed the former student as "borrower" and her father as a "co-signor" and which creditor claimed was executed by the former student. Creditor was successful in obtaining a judgment against the former student's father. The court however found the former student's testimony credible when she testified she had not signed the loan documents or had any knowledge of the loan. Her mother's testimony corroborated her testimony and her father was unable to identify the signature on the loan documents as that of his daughter and he claimed he did not know how the signature got on the documents. The court held that the father's testimony was not believable because he prepared the loan documents. The Appellate Court in its unpublished opinion of Educap Inc. v. Davis, upheld the lower court's opinion that the former student had neither expressly nor by implication agreed to repay the loan and though she benefited from the loan by being able to go to school it was the father's sole obligation to repay the student loan which he arranged for in compliance with his obligation under his divorce agreement. To hold the former student liable for her father's debt would be inequitable. If you are having problems with creditors due to student loan debt you should consult with an experienced consumer debt attorney immediately to protect your rights. For more information regarding student loans, bankruptcy, foreclosure, or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and is in no way intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

Are You Contemplating Bankruptcy Due To Foreclosure?

During this troubled financial time many New Jersey homeowners find themselves facing foreclosure. Mortgage companies, in spite of the massive number of foreclosures pending, tend to remain unwilling to discuss the issues or consider modification, partial payments or other means of resolving the matter. Often the homeowners will not speak to anyone and simply try to straighten out their finances by seeking additional employment or borrowing from others. Months go by and they receive a Complaint for Foreclosure which is ignored simply because they are frozen with fear by the prospect of losing their home. Eventually, if the homeowner does not respond to the complaint, even if they do try to negotiate directly with the mortgage company, they will receive Notices regarding Default as a result of not filing an Answer to the Foreclosure Complaint. Finally, the homeowner will find themselves facing an actual Judgment of Foreclosure. In a recent case, the Court denied a litigant's request to vacate a default judgment of foreclosure against his investment property. The debtor's claim was that under New Jersey Court Rule 4:50-1 (d) the Assignee Mortgagee did not have the original Promissory Note or Mortgage so that the Judgment was invalid and that the judgment should be set aside under Rule 4:50-1(f) due to exceptional situations to prevent a grave injustice. There was no denial that the mortgage was not paid or that there was a justification for failing to make the mortgage payments or any other justification for relief from the judgment under Rule 4:50-1 such as mistake, newly discovered evidence, fraud, misrepresentation, misconduct by the Assignee Mortgagee, that the judgment was satisfied, or released. The Court found there was no demonstration of prejudice which would warrant the litigant's last ditch effort at a reprieve from the judgment of foreclosure and the decision was upheld by Appellate Division. In another matter, the Appellate Court dismissed a complaint for foreclosure because the bank failed to provide proof of its status as the lender pursuant to the requirements of New Jersey Statute 12A:3-301 or the Uniform Commercial Code (UCC) and filed to comply with the notice requirement of the Fair Foreclosure Act (FFA) and N.J.S.A. 2A:50-56. In this matter, the debtor filed an objection with the court to the Bank's Complaint for Foreclosure prior to a Judgment being granted. There are no guarantees that if a homeowner attempts to address the issue of foreclosure prior to a Judgment that a foreclosure will not result, however, there are standards that a Bank must meet including proof of service, appropriate notice and the fact that is in the actual holder of the mortgage and entitled to bring the foreclosure action. If you are facing foreclosure, you should consult with an experienced foreclosure attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt related matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and is in no way intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

Can Credit Cards Be Used To Pay Bankruptcy Attorney's Fees?

Bankruptcy attorneys fees depend on the type of bankruptcy being filed, whether it be Chapter 7, 13 or 11 for businesses, plus there are filing fees charged by the Bankruptcy Court. Many of our potential clients, known as "debtors" ask if they can put the fees on their credit card. The fees cannot be put on the debtors' credit card and it is best if all credit card use is stopped because non-essential transactions which appear on credit cards within two years of filing for bankruptcy are highly scrutinized. In some cases the filing fees may be waived for hardship or allowed to be paid in installments. It is critical that you do not violate the bankruptcy code when filing your petition. If you are considering bankruptcy you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt matters in New Jersey visit www.TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief. Contributed by Tracy Luciano

Can Gambling Debt Be Discharged Through Bankruptcy?

Those who find themselves in financial trouble are often unaware that debts associated with gambling can be eliminated in a bankruptcy. While New Jerseyians have received certain benefits such as generating revenue for the Schools, from offering widespread gambling opportunities such as lotteries, racetracks, and casinos, it also has created some pitfalls. New Jerseyians often find themselves with unpaid gambling debts especially when they are provided with cash advances and extended unsecured lines of credit, which they cannot afford to pay back. The Bankruptcy Code does allow for the discharge of certain legal gambling debts. This is dependent on other factors in the debtors case, such as levels of income, monthly living expenses, other debts, and the bankruptcy chapter you qualify for. We can help you discover if you are eligible to discharge any gambling debt as well as your other debts that you are struggling to repay. To determine whether your gambling debts are dischargeable, as well as any other debts you are facing, you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief. Contributed by Tracy Luciano

Blocking a Chapter 7 Discharge

A woman claiming misrepresentation by a construction company filed a complaint seeking to block entry of a Chapter 7 discharge. The appeal was dismissed for failure to comply with Federal Rule of Bankruptcy Procedure 8006 and the woman sought reconsideration of the dismissal. The woman attempting to block the discharge, Filomena Boccella commenced an adversary proceeding pro se against the debtor based on claims grounded in consumer fraud and theft by deception. At the last minute, the Boccella sought to amend her complaint in order to avoid dismissal. Boccella’s opposition to the discharge was based on the fraud portions of 11 U.S.C. § 727(c), (d),(e) but her allegations were more aligned with 11 U.S.C. § 523(a)(2). Due to Boccella’s ineffective pursuit of the matter her case was dismissed, as was her appeal for failure to comply with Federal Rule of Bankruptcy Procedure 8006. In reviewing the motion for reconsideration of the dismissal the court, in In re Purington, looked to the matter of Poulis v. State Farm Fire & Cas. Co.,747 F.2d 863, 868 (3d Cir. 1984) where the court set forth 6 factors which must be considered in deciding whether a case may be dismissed without a hearing on the merits. The Poulis factors included (1) the extent of the party's personal responsibility; (2) the prejudice to the adversary caused by the failure to meet scheduling orders and respond to discovery; (3) a history of intentional delay by the party; (4) whether the conduct of the party or the attorney was willful or in bad faith; (5) whether other sanctions, short of dismissal, are more appropriate and curative; and (6) the meritoriousness of the claim or defense. Upon consideration, the court found dismissal of Bocella’s motion for reconsideration was inappropriate and reinstated her appeal. If you have been carrying the burden of IRS or other substantial debt, you can also obtain relief through bankruptcy. If you are considering bankruptcy you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

IRS Fraud is Likely Reason to Vacate Bankruptcy Order

IRS debt is a reason for many bankruptcy filings. Although bankruptcy can permit debtors to escape massive tax debt, if the IRS discovers the debtor willfully failed to pay the debt, misrepresented income or expenses or otherwise attempted to defraud the Internal Revenue Service, it is highly likely that the debt will not be avoided. Additionally, if IRS debt is expunged, reduced or modified and the IRS learns of fraud relating to the debt there will likely be a dispute as to the dischargeability of the debt and any reduction or modification. In the recent matter of In re Clemente, the United States filed a motion for reconsideration of the order permitting the Chapter 7 trustee to expunge, reduce and modify 2 proofs of claims. The court found that the debtor did willfully refuse to pay taxes due and also levied penalties and interest. The order to expunge and reduce the claim of the IRS was vacated as the priority claim was nondischargeable. If you have been carrying the burden of IRS or other substantial debt, you can also obtain relief through bankruptcy. If you are considering bankruptcy you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

Dionne Warwick Seeks IRS Relief Through Chapter 7 Filing

Singer Dionne Warwick's affiliation with the Psychic Friends Network provided her with no known warning of her future bankruptcy or the need to cut back on her spending. Dionne Warwick filed a Chapter 7 bankruptcy petition in March 2013 stating her income and expenses to be equal at $21,000 per month and leaving her with nothing to pay outstanding debts. Dionne Warwick's stated expenses may have been substantial but, based on her outstanding unpaid tax burden of approximately $10,000,000 they were not substantially deductible. Dionne Warwick owes $7,000,000 to the Internal Revenue Service which accumulated from 1991 to 1999. There is a potential dispute as to the portion of this debt attributable to penalties and interest. IRS debts are dischargeable in the event the debtor meets all of the following criteria: 1) the taxes are only income taxes; 2) the debtor properly filed all returns; 3) the debtor did not attempt to evade payment of the taxes; 4) the debt is at least 3 years old; and 5) the debt was assessed at least 240 days before the debtor files the bankruptcy petition or was not yet assessed. Representatives for Dionne Warwick say she filed all returns and paid the debt leaving only interest and penalties to make up the $10,000,000 outstanding debt. If this is true, because of the age of the delinquent taxes, Dionne Warwick will likely find herself free of this substantial debt she has carried since 1999. If you have been carrying the burden of IRS or other substantial debt, you can also obtain relief through bankruptcy. If you are considering bankruptcy you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

FDCPA Offers Protection From Harassing Creditors

The Federal Trade Commission released a study on January 30, 2013, discussing the shady actions harassing creditors take to unfairly collect debts. Many of these debts are usually from credit cards and can be discharged if the debtor files a Chapter 7 bankruptcy. The FTC found that debt buyers, usually collection agencies or law firms who have bought the debt from the original creditor, often lack basic information about the debt they are trying to collect. Many times they do not even know if the debt is valid, whether the consumer has disputed the debt or even when the statute of limitations has run on the debt. The FTC requires that creditors have a reasonable basis for believing a debtor lawfully owes the debt they are trying to collect on, yet some creditors cannot even establish that much when they file judgments against debtors! The FTC concluded that the Fair Debt Collections Practices Act (FDCPA) should be updated to better protect debtors from unscrupulous debt collectors. In the meantime, if you are considering filing for bankruptcy and are receiving harassing communications from creditors who may not even have a legitimate claim against you, remember filing for bankruptcy will stop the harassment and allow you time to scrutinize your debts. If you are considering filing for bankruptcy you will be addressing many issues concerning protection from creditors and should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information on how to protect yourself from creditors, foreclosure, other consumer debt or bankruptcy law matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. We are a Debt Relief Agency. We help people file for bankruptcy relief.

FDCPA Provides For 30-Day Dispute Period

In a recent consumer debt matter Stokes v. Transworld Systems Inc., an individual, Pamela Stokes, brought a class action suit against Defendant Transworld Systems, Inc. (TSI) for claimed violations of the Fair Debt Collection Practices Act (FDCPA) following her receipt of collection letters she received. Stokes claimed that reference to the 30 day FDCPA dispute period in a second collection letter and reference to a legitimate debt in a third collection letter were misleading and deceptive and would confuse the "lease sophisticated consumer" about how to dispute the validity of the alleged debt. The first letter from TSI set forth an amount due and informed Stokes of a 30 day notice to dispute the debt and how to do so. The second letter explained that, if the debt was not disputed within the 30 day dispute period set forth by the FDCPA, it would be assumed valid and collection efforts would continue. After the 30 day FDCPA dispute period expired, Stokes attorney sent a letter via facsimile, certified and regular mail pursuant to 15 U.S.C. 1592c(c) demanding TSI cease and desist all collection efforts immediately, cease direct communications with Stokes, disputing the debt, demanding verification of the debt and the name and address of the original creditor. The following day, TSI sent a letter directly to Stokes seeking payment in order to avoid transfer of the matter to telephone collectors. The purpose of the FDCPA is to protect consumers by eliminating abusive practices by debt collectors, protect debt collectors using legal collection methods. The courts, in effecting the acts intent, have reviewed the creditors' actions under the "least sophisticated debtor" perspective. Communication is deceptive within the FDCPA if it can reasonably be read with 2 or more different meanings and one would be considered inaccurate. The primary question in determining FDCPA violations is whether the "notice fails to convey the required information clearly and effectively and thereby makes the least sophisticated consumer uncertain as to the meaning of the message" Weiss v. Zwicker, 664 F. Supp. 2d 214, 216 (E.D.N.Y. 2009) Not every letter sent from a debt collector within the 30 day dispute period violates the Act. A follow-up letter need not restate the rights set forth in the initial validation notice, nor must it set forth the expiration date of the 30 day dispute period. Simply put, follow-up letters must not confuse the least sophisticated debtor as to their rights under the FDCPA. Therefore, the actions of TSI were held to be valid and Stokes matter was dismissed. If you are facing mounting debt or believe a debt collector is pursuing you inappropriately, you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding how the FDCPA can protect you from harassment and unfair collection practices or for information regarding bankruptcy, foreclosure or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. We are a Debt Relief Agency. We help people file for bankruptcy relief.

Chapter 13 Plan Disturbed for Want of Service

In a Chapter 13 bankruptcy, the bankruptcy court granted a debtor's unopposed motion ordering the IRS to release a levy and return the debtor's funds. The IRS was also ordered to pay the debtor's attorney fees, costs and actual damages. The United States sought to vacate the order and allow the IRS to retain the levy and debtor's funds based on the court's lack of jurisdiction over the United States and its agencies. The United States argument was grounded in the debtor's failure to provide proper notice of the debtor's motion to the clerk for the U.S. attorney for the district of New Jersey or the attorney general in Washington, D.C. Under Federal Rule of Bankruptcy Procedure 7004. Bankr. R. 7004(4) includes, in pertinent part, that service "upon the United States is effected by mailing a copy of the summons and complaint to the civil process clerk at the office of the United States attorney for the district in which the action is brought and by mailing a copy of the summons and complaint to the Attorney General of the United States at Washington, District of Columbia…" Although the premise behind bankruptcy discharges and confirmation of plans is the provision of a clean slate and a fresh start for the debtor without the need to worry about prior creditors returning, debts may not discharged if the debtor was not properly noticed of the bankruptcy. Under Federal Rule of Bankruptcy Procedure 9024, Federal Rule of Civil Procedure 60(b)(4) operates to allow relief from a judgment or order for failure to properly notice the creditor in a Chapter 13 bankruptcy. If you are considering bankruptcy you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

Avoiding A Foreclosure Sale With Bankruptcy

Bankruptcy offers an automatic stay which can assist a home owner in advance of a foreclosure and sheriff's sale. The Chapter 13 filer and the Chapter 7 filer can both obtain foreclosure relief in this manner. The debtor must be aware of when a filing will help and should not wait until the sheriff's sale to take advantage of this protection. When the debtor in US Bank National Association v. Rodriguez attempted to utilize bankruptcy after the fact to avoid a sheriff's sale the judge ruled that the time for Defendant to act had long expired and debtor's lack of action until the 11th hour would not be permitted to work and injustice against the bank. The debtor failed to enter the foreclosure action, in spite of proper notice from the bank, and a default judgment in foreclosure was entered in 2009. Only upon learning the sheriff's sale was looming did the debtor act but the only action taken was to utilize all adjournments of the sheriff's sale available by law and attempt to induce the bank to modify the loan. Finally, after the sheriff's sale took place, the debtor filed bankruptcy in an effort to vacate the sheriff's sale. An automatic stay will not permit you to stay in your home forever or strip the mortgage from a primary residence but it will give you the breathing room you need to review the different options available to you as a bankruptcy filer. If you are facing foreclosure you should consult with an experienced consumer debt protection attorney immediately in order to protect your rights. For more information regarding foreclosure, bankruptcy or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. Our law firm is a debt relief agency and helps people file for bankruptcy relief.

NJ Offers Choice of State or Federal Exemptions

Under the bankruptcy laws of New Jersey, a debtor may elect using either New Jersey or Federal bankruptcy exemptions. When you file Chapter 7 bankruptcies, non-exempt property you own will usually be used by Trustee to pay off your creditors. Under Chapter 13 bankruptcy, a Trustee will usually require you to pay any amount owed to creditors on the value of your property that is not exempt. Properties qualifying for exemption vary between State and Federal law, which has its own set of exemptions. Although New Jersey allows you to choose between Federal and New Jersey State exemptions,you cannot mix and match between the two. Deciding whether State or Federal exemptions are more beneficial to you largely depends on your situation. For instance, if you want to try and save your home, federal exemptions may be better for you as you are allowed to exempt over $20,000 of equity in your home (over $40,000 for a married couple filing jointly). Both State and Federal exemptions include specific values you may exclude in your automobiles, clothing, pensions and insurance, to name a few If you are considering filing for bankruptcy you will be addressing many issues concerning which set of exemptions to choose from and should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding which set of bankruptcy exemptions to choose from, foreclosure, consumer debt or other bankruptcy law matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. We are a Debt Relief Agency. We help people file for bankruptcy relief.

Protecting Your Home in Bankruptcy

If you are a homeowner and thinking about filing for bankruptcy, there are many factors which you must take into consideration in order to protect your home. When you file for bankruptcy, you must inform the bankruptcy Trustee of all the assets you own, including your home. Assets which are not exempt will be used by the Trustee to pay off your creditors. Under New Jersey law, there is no homestead exemption; only a non-debtor spouse’s survivorship interest in the home is spared. However, under Federal law an individual is allowed to exempt $21,625, of equity in their home, $43,250 for a married couple filing jointly. If you have more equity in your home than what is allowed to be exempt, a Trustee could force the sale of your home to pay your creditors. If that is the case, you should look to remove second and third mortgages on your home or even look into trying to file a Chapter 13 bankruptcy. If you are considering filing for bankruptcy you will be addressing many issues concerning your home, and should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding how to protect your home during a bankruptcy, foreclosure, consumer debt or other bankruptcy law matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. We are a Debt Relief Agency. We help people file for bankruptcy relief.

Effect of Bankruptcy On Your Credit Score

Filing for bankruptcy will be reported on a person’s credit report and will have an impact on their credit rating. However, it may not be nearly as bad as they think and could even improve their score. Once someone’s bankruptcy is processed and reported on their credit score, it will unfortunately be listed for 7 years if it was a Chapter 13 bankruptcy and up to 10 years if it was a Chapter 7 or 11. This will negatively impact their score if prior to the bankruptcy they had a stellar credit score to begin with. However, the fact is many people who file bankruptcy do so because they are unable to make on time payments to their creditors in the first place and already have taken many negative hits on their credit report. As such, their credit score has already been negatively affected and filing for bankruptcy will not actually lower it significantly . In fact, depending on the amount of bad debt the person has, filing for bankruptcy could even make their credit score better as bankruptcy wipes clean all of the person’s dischargeable debts, leaving a better credit score despite having a bankruptcy listed on their credit report. If you are considering filing for bankruptcy you will be addressing many issues concerning your credit score and should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding your credit score, bankruptcy, foreclosure or consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. We are a Debt Relief Agency. We help people file for bankruptcy relief.

Chapter 13 vs. Chapter 11 Bankruptcy

The differences between filing a Chapter 13 or Chapter 11 bankruptcy are very important to understand as the law has specific requirements for each. Although the underlying purpose of both Chapters is to reorganize and eliminate debts, one is usually better suited than the other for each case. For instance, it is important to understand before filing that only individuals and sole proprietorships can file Chapter 13 bankruptcy whereas types of business excluded from Chapter 13, such as corporations and partnerships, and individuals can file Chapter 11. In addition, it is important to note that individuals who file for Chapter 13 must not have more than $360,475 in unsecured debt and $1,081,400 in unsecured debt, whereas Chapter 11 has none of these requirements. Because there is no cap on the amount of debt the debtor has in a Chapter 11 filing, it is usually a more complicated process as debtors filing under Chapter 11 have more debts and creditors that need to be considered by the Bankruptcy Court. If you are considering filing for bankruptcy you will be addressing many issues what type of bankruptcy you should file and should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding the type of bankruptcy you should file or other bankruptcy, foreclosure or consumer debt law matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. We are a Debt Relief Agency. We help people file for bankruptcy relief.