There is a pile of envelops, unopened, piling like a mountain outside your door – so dense and heavy you cannot escape your home. The statements from the bank reveal your accounts are empty. You have no lines of open credit left. The accumulating unpaid dues are too much. Your credit score is in the gutter. Bankruptcy is your best option right now, and you need it now.
Bankruptcy always feels like an emergency. Financial difficulties are urgent matters that drag us into the muck. Debts and unpaid bills tether us to weights that plunge us into a financial oblivion from which there seems to be no escape. Or, at least, that is how it appears. No situation is ever as hopeless as it appears when you are experiencing it. Your problems have solutions.
Emergency bankruptcy is one such solution. However, what differentiates an "emergency bankruptcy" from an ordinary bankruptcy? As it turns out, very little.
We are proud to present the first consensual Chapter 11 Subchapter V Bankruptcy Plan of Reorganization for an individual debtor. Here, the Debtor’s proposed plan of reorganization was approved by the US Bankruptcy Court for the District of New Jersey on September 8, 2020, and was primarily handled by one of Scura’s attorneys, Carlos D. Martinez, Esq. This is a groundbreaking case for bankruptcy law and for the implementation of the new Small Business Reorganization Act
Marriage is a life-altering event for so many people. However, so is bankruptcy. When the two become embroiled in one another, things can quickly unravel into a complicated, involved mess. Such is the case with one of our clients, who we refer to as Moon, who wished to file for bankruptcy, only for one conditional gift to fall into a legal gray area.
Moon wished to be married. He had already proposed to his bride-to-be, who wore an engagement ring on her finger. The ring was valued at $30,000, making it quite the valuable stone. However, in the months following his proposal, Moon realized he might need to consider filing for bankruptcy. Specifically, Chapter 7 Bankruptcy. Often referred to as the Liquidation Chapter, Chapter 7 Bankruptcy involves the filing debtor to retain certain assets while the remaining assets, if any, are sold and distributed pro rata to his/her creditors in an effort to partially satisfy the debts that are not wiped thanks to filing. The filing debtor’s assets are determined at the time of filing.
While Chapter 7 Bankruptcy would erase all of Moon’s financial woes, filing introduced a new concern: would he be forced to sell-off the engagement ring he gave to his fiancé to settle his debts?
It is not an understatement to say that filing for bankruptcy can impact your credit score. Many fear the intense impact such a filing can have on their score, fearing apocalyptic repercussions of such a deal. Many of these anxieties are exaggerated responses, since very often bankruptcy can have a positive impact on those who need relief most. Filing for bankruptcy can result in score improvement between two months and one year of filing if you had serious delinquencies on debts prior. However, those with perfect credit scores or those whose debts primarily that do not show up on New Jersey credit reports, such as medical bills, will often see a significant drop in their credit score after filing for bankruptcy.
Everyone possesses something that carries with it great emotional value. It can be a possession we cherish, put on display, tell others its worth, and maintain even as years – decades, even – pass. Some are willing to spend extraordinary amounts of money to get a hold of a collector’s item. Old Civil War weapons, old car models, old film props – all are collector’s items worth thousands to the average collector but worth all the money in the world to those who treasure them.
A lot of uncertainty comes when filing for bankruptcy. You set out in life with dreams of financial prosperity, only to need bankruptcy relief when life gets in the way. There are several anxieties and fears that will emerge and overwhelm you when you as an individual initially file for either Chapter 7 or Chapter 13 Bankruptcy Relief. Even though you know this is the best decision for you in the current moment, you cannot help but think of the future and what negative ramifications might sprout from his decision.
One of the most common concerns is that filing for bankruptcy will damage or decrease your credit score. Will declaring bankruptcy bring your credit score down far enough to the point where you will be denied loans and mortgages? What other elements of your life will this impact? While bankruptcy will unavoidably impact your credit score, many do not know in which ways it will be affected. The reality, however, is far less frightening than whatever imagined apocalyptic scenario you imagined. While it might take years to purge a bankruptcy record from your credit history, the reality is you can raise your credit score to a solid level within months of your filing.
Property is the ultimate form of collateral. In New Jersey, when you take out your mortgages and pay your taxes, you offer up your property and home as collateral in case you fail to meet said payments. You have title to the property but the lender or creditor has a lien on the property. If you cannot pay your lender, then said lender will be within their legal rights to go and collect on their collateral. That means you might lose your house and home when the authorities – led by the county sheriff -- set out to sell our property. This process, referred to as a sheriff sale, is a means to pay off the outstanding debt to the lender that you have accrued.
However, each state conducts sheriff sales in a different manner. The rules that govern each sale depends on the state the property is owned in. Sometimes, court decisions or changes in the laws drastically alter how sheriff sales are conducted, as well as how this alters how sales can be conducted.
Such is the case for New Jersey. The rules for adjourning sheriff sales changed significantly on July 28, 2019, when the New Jersey statute was modified impacting the rights and options of borrowers under New Jersey foreclosure law. N.J.S.A. 2A:17-36, governs the rules on adjournments of sheriff sales and provides:
Unlike other financial issues such as credit card debt, medical debt is not caused by unwise monetary choices, but rather it is often caused by unforeseen circumstances. The issue is cyclical: You are in debt because of unforeseen medical circumstances and the financial stress that comes with these additional medical expenses causes you to get sicker and deeper into medical debt.
The most beneficial protection provided to individuals and corporate entities filing during bankruptcy proceedings is the “automatic stay”. The automatic stay is immediately invoked upon the filing of a bankruptcy petition and prevents any creditor from taking actions to collect a pre-petition debt. This article will explore whether any other individual or corporate entity also obligated to the same debt (also know as a “co-debtor”) is protected by the automatic stay, even if they did not seek bankruptcy relief.
While individual debtors are permitted to use power of attorneys during bankruptcy proceedings, there are rare circumstances that obtaining a guardian ad litem for an incompetent individual may be beneficial to administering the bankruptcy estate. As such, this blog will analyze the law and rare request for a guardian ad litem for purposes of a bankruptcy proceeding.
