Bankruptcy Attorney in Somerville, New Jersey

Bankruptcy is often perceived as frightening and overwhelming. Still, in truth, it can be a lifeline for those drowning in debt. It's a legal process that provides individuals and businesses a chance to regain control over their financial situation. Attorney Herbert K. Ryder understands the emotional turmoil that comes with insurmountable debt. The firm’s mission is to help clients navigate through these challenging times and guide them towards a brighter financial future. With Attorney Herbert K. Ryder, you're not alone in this journey. The Law Offices of Herbert K. Ryder LLC proudly assist clients in Somerville, Clinton, New Brunswick, Princeton, and Woodbridge, New Jersey. 

Understanding Bankruptcy in New Jersey

Bankruptcy isn't a sign of failure. Instead, it's a tool designed to provide financial relief and a fresh start to those burdened by unmanageable debt. Under federal law, bankruptcy allows individuals and businesses in New Jersey to either eliminate or restructure their debts. It unwinds the contracts between you and your creditors, allowing you the opportunity to rebuild your financial life. 

It's crucial to remember that bankruptcy is a legitimate option for those facing overwhelming debt. It's not something to be ashamed of or postponed indefinitely. Instead, think of it as a step towards regaining your financial independence and stability. 

Your Bankruptcy Options 

Different types of bankruptcy serve different purposes and apply to specific situations: 

Chapter 7 Bankruptcy 

Also known as liquidation bankruptcy, Chapter 7 involves selling off your non-exempt assets to repay your debts. This option is typically suitable for individuals or families with lower income and significant unsecured debt, such as credit card balances and medical bills. 

Chapter 11 Bankruptcy 

Primarily designed for businesses, Chapter 11 allows companies to restructure their debts while continuing their operations. It provides an opportunity to develop a repayment plan that satisfies creditors while enabling the business to regain its financial footing. 

Chapter 13 Bankruptcy 

Chapter 13, also known as reorganization bankruptcy, involves creating a payment plan to repay your debts over three to five years. This option is ideal for individuals with regular income who can make consistent payments towards their debts. 

Deciding Which Bankruptcy Chapter Is Right for You

The choice of bankruptcy chapter depends on your specific situation. For instance, if you're an individual with significant unsecured debt and limited income, Chapter 7 may be the best option. On the other hand, if you're a business owner looking to restructure your company's debts and continue operations, Chapter 11 would be more suitable. If you have a steady income and want to save your home from foreclosure, Chapter 13 could provide the best solution. 

Tips When Filing for Bankruptcy

Filing for bankruptcy is a serious decision that requires careful thought and planning. Here are tips to follow when filing for bankruptcy: 

1. Assess Your Financial Situation: The first step in filing for bankruptcy involves taking a comprehensive look at your financial situation. This includes reviewing all debts, assets, income, and expenses. By understanding the full extent of your financial circumstances, you're able to make informed decisions throughout the bankruptcy process. 

2. Consult with a Bankruptcy Attorney: It's crucial to seek professional advice from a bankruptcy attorney like Herbert K. Ryder. He has the resources and knowledge to look out for your best interests. 

3. Choose the Appropriate Bankruptcy Chapter: Each chapter of bankruptcy has its own eligibility criteria and implications, choosing the correct one for your situation is key. 

4. Complete Credit Counseling: Credit counseling provides information and assistance in managing your debts and finances.  

5. Gather Necessary Documents: To file for bankruptcy, you need various documents such as financial statements, tax returns, pay stubs, bank statements, and a list of your assets and liabilities.  

6. Prepare and File the Bankruptcy Petition: A bankruptcy petition includes detailed information about your financial situation, debts, assets, income, and expenses. This petition is then filed with the bankruptcy court in your jurisdiction. 

7. Attend the Meeting of Creditors: After filing the bankruptcy petition, you're required to attend a meeting of creditors, also known as a 341 meeting. During this meeting, the bankruptcy trustee and your creditors may ask questions regarding your financial affairs.  

8. Complete Financial Management Course: Before receiving a discharge of your debts, you must complete a financial management course from an approved agency. This course provides the necessary tools and knowledge to manage your finances effectively in the future. 

9. Follow Court Proceedings and Requirements: Throughout the bankruptcy process, it's imperative to comply with all court proceedings and requirements. This includes attending hearings, providing requested documentation, and cooperating with the bankruptcy trustee. 

If you successfully complete all necessary steps and meet the requirements, you receive a discharge of your debts. This discharge releases you from personal liability for certain debts and provides you with a fresh financial start. 

What Are the Bankruptcy Exemptions in New Jersey?

Bankruptcy exemptions play a critical role in both Chapter 7 and Chapter 13 bankruptcy cases. They determine what property you can keep to maintain a basic standard of living after bankruptcy. In New Jersey, you have the option to use either state or federal exemptions, but you can't mix and match from both lists. 

The Homestead Exemption

Unlike many other states, New Jersey doesn't offer a specific homestead exemption to protect your equity in a primary residence. However, if you choose to use federal exemptions, there is a modest homestead exemption available. 

Motor Vehicle Exemption

New Jersey also doesn't provide a specific motor vehicle exemption. You can apply the $1,000 personal property exemption to your vehicle's equity or opt to use the federal exemptions, which include a motor vehicle exemption. 

Personal Property and Other Exemptions

In New Jersey, you can exempt up to $1,000 in household goods and furnishings, clothing, and pay owed to you for participating in the state militia. Public assistance for the aged and unemployment compensation are also exempt. Business-related exemptions include stocks and interests in corporations and business partnership property. You can also protect certain retirement and pension benefits. 

Additionally, New Jersey provides a wildcard exemption of up to $1,000, which can be applied to any personal property, stocks, or corporate interests.