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Filing Bankruptcy in NJ
The new bankruptcy laws have left few overwhelmed debtors across the nation unscathed, and New Jersey is no different. Due to the personal bankruptcy changes in 2005, more consumers are being forced to pay higher attorney fees & court costs and even more importantly, many are being forced into Chapter 13 payment plans, instead of the straight bankruptcy, or Chapter 7. For consumers with credit card debt, deficiency balances from repossessions, medical bills, and most collections debt, Chapter 7 is the preferred route due to the fact that in a lot of cases the debt can be wiped out without paying more than court and attorney fees. Chapter 13, on the other hand, involves taking the consumer’s disposable monthly income until all the debt is paid in full or formally discharged. When you factor in the long-term credit effects of doing this, Chapter 13 rarely makes sense for most types of unsecured debt.
So who exactly is being forced to file Chapter 13? For the most part, it is consumers who earn more than the median income in their state. If these higher income debtors fail to pass the means test, which is a set of questions about your income and expenses that is used to figure out whether someone can actually pay back a reasonable portion of their debt, then they will be required to declare Chapter 13 instead of 7. The following is median income information for New Jersey as of 2006:
2-person families: 63,026
3-person families: 80,999
4-person families: 94,441
5-person families: 92,225
6-person families: 94,004
7-or-more-person families 79,817
Not set on bankruptcy? You’re not alone! Submit a form and let PayingPaul.Com match you with an industry leading debt management company for a free consultation!
NJ Bankruptcy Statistics
2004: 40,596
2005: 48,832
2006: 13,548
The number of bankruptcy filings in New Jersey dropped dramatically in 2006 against the backdrop of the overhauls to the bankruptcy rules. In 2005, Congress and President Bush signed into law new legislation that made filing for Chapter 7 “straight” bankruptcy a much more difficult task. As a result, fewer people could qualify for this chapter bankruptcy and due to the more complicated nature of the act, bankruptcy attorneys started charging more to file a case. This being the case, bankruptcy filings dropped by more than 72.2% and more consumers began seeking out other alternatives like debt settlement and debt counseling.
Or for more information about some other debt issues pertaining to New Jersey, check out these articles:
New Jersey Consumer Credit Counseling Services
New Jersey Bankruptcy Laws
New Jersey Debt Collection
Filing Bankruptcy in NJ
The new bankruptcy laws have left few overwhelmed debtors across the nation unscathed, and New Jersey is no different. Due to the personal bankruptcy changes in 2005, more consumers are being forced to pay higher attorney fees & court costs and even more importantly, many are being forced into Chapter 13 payment plans, instead of the straight bankruptcy, or Chapter 7. For consumers with credit card debt, deficiency balances from repossessions, medical bills, and most collections debt, Chapter 7 is the preferred route due to the fact that in a lot of cases the debt can be wiped out without paying more than court and attorney fees. Chapter 13, on the other hand, involves taking the consumer’s disposable monthly income until all the debt is paid in full or formally discharged. When you factor in the long-term credit effects of doing this, Chapter 13 rarely makes sense for most types of unsecured debt.
So who exactly is being forced to file Chapter 13? For the most part, it is consumers who earn more than the median income in their state. If these higher income debtors fail to pass the means test, which is a set of questions about your income and expenses that is used to figure out whether someone can actually pay back a reasonable portion of their debt, then they will be required to declare Chapter 13 instead of 7. The following is median income information for New Jersey as of 2006:
2-person families: 63,026
3-person families: 80,999
4-person families: 94,441
5-person families: 92,225
6-person families: 94,004
7-or-more-person families 79,817
Not set on bankruptcy? You’re not alone! Submit a form and let PayingPaul.Com match you with an industry leading debt management company for a free consultation!
NJ Bankruptcy Statistics
2004: 40,596
2005: 48,832
2006: 13,548
The number of bankruptcy filings in New Jersey dropped dramatically in 2006 against the backdrop of the overhauls to the bankruptcy rules. In 2005, Congress and President Bush signed into law new legislation that made filing for Chapter 7 “straight” bankruptcy a much more difficult task. As a result, fewer people could qualify for this chapter bankruptcy and due to the more complicated nature of the act, bankruptcy attorneys started charging more to file a case. This being the case, bankruptcy filings dropped by more than 72.2% and more consumers began seeking out other alternatives like debt settlement and debt counseling.
Or for more information about some other debt issues pertaining to New Jersey, check out these articles:
New Jersey Consumer Credit Counseling Services
New Jersey Bankruptcy Laws
New Jersey Debt Collection