This is a guide to help you understand how filing for Bankruptcy in New Jersey with an experienced Bankruptcy attorney can help you. In this guide, I will provide some well known and not so well known uses for Bankruptcy and how it can benefit you.
How Bankruptcy Can Save Your House From Foreclosure
New Jersey is one of several states which have a Bankruptcy Court Mortgage Loan Modification Program. By filing a Chapter 13 Bankruptcy and a motion to be admitted to the Bankruptcy Court's Mortgage Loan Modification Program you have the power and authority of the Bankruptcy Court behind you. Lenders cannot play their typical games which are prevented, since all documents are filed electronically through a portal and are time stamped. But remember, there is no legal right to a mortgage loan modification. Although sometimes the principal of the mortgage is reduced, I tell all my clients not to expect it. If a lender decides to consider you for a mortgage loan modification, you will be required to make between 3 to 6 trial payments. If you make those payments timely, then you will get a permanent loan modification, which will most likely be for 40 years and your payments will almost certainly less than what you were paying previously. Then you will be able to come out of Bankruptcy.
Bankruptcy Can Eliminate EZ-Pass Fines and Penalties.
EZ-Pass Fines and Penalties are considered to be an unsecured debt. So they are dischargable in Bankruptcy. (Unless you engaged in fraud). This means that if your registration was suspended and/or your car was impounded, you will be able to get your car back and just pay for the impound fee and license restoration fee.
Bankruptcy Can Make Student Loan Payments More Affordable
Depending on your monthly student loan payments, a Chapter 13 Payment Plan will spread your payments out over a 5 year period, often for less than you are paying now per month. Although interest will continue to accrue, with reduced monthly payments, you have 5 years to increase your earning power.
Bankruptcy Can Improve Your Credit Score
By filing Chapter 7 Bankruptcy to eliminate credit card debts, medical bills and other discharable debts, you will be able to have those debts discharged. Once you have obtained your discharge, you can apply for fully secured credit cards (those are cards that the lender holds a savings account equal to the credit line). After 1 year, they will be converted to unsecured cards and you can apply for regular unsecured cards.
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