Robert Manchel

Retirement Plans, Pensions And Bankruptcy – Explained By A NJ Bankruptcy Lawyer

December 9, 2011 by Robert Manchel

In general, upon the filing of the bankruptcy case, all of the debtor’s property is included in the bankruptcy estate. In a chapter 7, the debtor can keep all property that has low equity or value. Although unusual, if the debtor owns property with substantial value that exceeds the amount of the allowable exemptions, the trustee may be permitted to sell the property. In the event that the debtor owns property with substantial value, the debtor may wish to keep the property by filing a chapter 13 case, and making a monthly payment to the trustee that is commensurate with the property value.
There is certain property that is not included in the bankruptcy estate, no mater the value. “Employee Retirement Income Security Act” (ERISA) qualified retirement plans, such as an: IRA; SEP; employee pension plan, 401k and 403b, are the type of property that is not included in the bankruptcy estate. This means that no matter the value of the retirement plan, the debtor may continue to hold the funds in the account, which will not be included as the debtor’s property.
In chapter 7 and 13 cases, the court requires the debtor to complete two analysis’ to determine the debtor’s monthly disposable income. One analysis is called the Means Test or Current Monthly Income Test and the second test is a comparison of the debtor’s projected income on schedule I, and their monthly expenses on schedule J. In a chapter 7, the debtor may not have any monthly disposable income. In a chapter 13, the debtor must make monthly payments to the trustee, that are no less than the debtor’s monthly disposable income.
Typically, a chapter 7 debtor may use as a legitimate expense any monthly payments for a required (involuntary) pension contribution and payments regarding a pension loan. However, if the pension contribution is not required, the monthly payment, cannot be deducted and used as an expense. However, a chapter 13 debtor may use as an expense, voluntary or non voluntary contribution payments for a pension and payments for a pension loan.
Usually, a New Jersey State or local government employee is required (involuntary) to contribute to his pension and an employee of a private company is not required to contribute to his pension.
Please contact NJ consumer bankruptcy attorney Robert Manchel at 1 (866) 503-5655, for questions about how bankruptcy deals with retirement plans.

What Happens To Debt Incurred After A New Jersey Bankruptcy Filing?

November 30, 2011 by Robert Manchel

In general, bankruptcy deals with debt that was incurred prior to the filing. In a chapter 7, the bankruptcy filing, has no effects on debt that was incurred after the filing. This means that if the debtor finances a car or uses a credit card after the filing, the creditor may pursue the debtor for the collection of the debt.
A debtor has the option of converting their chapter 13 case to a chapter 7. In the event that a debtor incurs debt after the filing of a chapter 13 and prior to the conversion, the debt is treated as though it was incurred prior the chapter 13 filing. This means if the debt is typically dischargeable in a 7, then the debt will be discharged.
Any debt incurred by a chapter 13 debtor during the bankruptcy plan, has the right to wait until the completion of the case to pursue the debtor for any default or funds due to the creditor. However, certain chapter 13 creditors who lent funds to the debtor, after the filing, have the right to receive payment by the trustee, through the bankruptcy plan.
If a chapter 13 debtor incurs tax debt after the filing, the taxing entity may require the debtor to pay the debt during the balance of the trustee payment plan. Also, if the chapter 13 debtor incurs domestic support debt after the filing, the court will require that the debtor cure this debt, prior to receiving a discharge.
In a New Jersey chapter 13 bankruptcy case, if the debtor incurs a consumer debt that is necessary for the debtors performance under the plan, such as auto financing, the creditor may file a claim. The claim must be handled and paid, in compliance with the manner in which claims of that type are normally paid. Please note that if a chapter 13 debtor wishes to borrow money, she must first request approval from the trustee or court.
If a debtor incurs a debt in a chapter 13 that is not necessary for performance of the plan, or not for an after filing tax liability, and not for a domestic support obligation, the debtor and the creditor must agree to include the creditor’s claim in the bankruptcy case in order to be paid by the trustee.
To contact an experienced New Jersey Chapter 7 or Chapter 13 Bankruptcy Lawyer, call Robert Manchel at 1.866.503.5655.

Bankruptcy Debt Counseling – Discussed By A New Jersey Bankruptcy Attorney

November 21, 2011 by Robert Manchel

Prior to the filing of any bankruptcy case, an individual must obtain debt / credit briefing, within 180 days prior to the filing. The briefing or counseling session is a specific kind of counseling that is tailored for bankruptcy. The briefing must be provided by an agency that has been approved by the Federal Court of the District in which the person is filing for bankruptcy protection. At present, there are about 67 approved agencies, by the State of New Jersey.
After the briefing, the agency will provide a certification indicating the agency’s name, the counselor’s name, and the name of the individual(s) who completed the counseling. This certification must be filed with the court, together with the bankruptcy petition. The court allows a very limited excuse for non-compliance, due to exigent circumstances.
At the commencement of the counseling, the counselor must be notified that the purpose of the briefing is for bankruptcy. This should not be confused with debt consolidation counseling, which is an attempt to reduce one’s debt or monthly debt payments.
The Agency should offer the briefing by telephone and internet and permit both spouses to obtain the briefing together, at the same time. The entire session should last about one to two hours.
The counseling consists of the following. The counselor asks for detailed financial information, the individual’s household income, expenses, and liabilities. The representative may complete a budget and explain how an individual could reduce their expenses. Also, the counselor should provide information as to where one can find coupons and businesses, where a consumer may save money.
Please call Attorney Robert Manchel at 1 (866) 503-5655, if you have questions about debt and what bankruptcy means.

Do You Have To Include All Creditors If You File For Bankruptcy in NJ?

November 14, 2011 by Robert Manchel

Many clients ask if they can keep certain creditors out of the bankruptcy case, such as debt owed to a friend or relative. The simple answer is no. All creditors must be included in the bankruptcy case.
A personal loan that is due to a friend is unsecured, which is the same classification as credit card debt. The bankruptcy code requires that all unsecured creditor be treated equally. Therefore, if a chapter 13 debtor is paying a monthly trustee payment, which includes $100.00 that is to be paid towards unsecured debt, the monthly amount distributed to unsecured creditors must be distributed pro-rata to all unsecured creditors. Also, this means that the debtor cannot make payments directly to the friend or relative that is not included with the trustee payment.
Along this same theory, if a debtor is only having problems with their credit card debt and not their house, the house must be included as an asset and the mortgage company must be included as a secured creditor. However, the inclusion of the house and mortgage does not mean that the house will be taken by the bankruptcy trustee. Quite the contrary, it is extremely unusual for the court trustee to take someone’s property. However, if the debtor is behind with their mortgage payments and they are unable to cure the arrears, typically the mortgage company will be permitted to pursue their foreclosure action.
The debtors must also include their auto as an asset and the auto finance company as a secured debt. It is very unusual that the court trustee will take the debtors’ auto. If the debtor is in arrears with their finance payments and cannot cure the arrears, typically, the finance company will be permitted to repossess the auto.
If you wish to contact New Jersey Bankruptcy Expert Robert Manchel, please call 1 (866) 503-5655 to discuss how creditors are treated in bankruptcy and how you may be able to file for bankruptcy protection.

Chapter 13 Hearings Explained By New Jersey Bankruptcy Lawyer

November 7, 2011 by Robert Manchel

NJ Attorney For Chapter 13 Bankruptcy Hearings

There are two bankruptcy hearings in a New Jersey chapter 13 bankruptcy case. The first is called the Meeting of Creditors (MOC) or 341(a) hearing. The second is called the Confirmation Hearing.
The MOC is never held in a courtroom and a judge is not permitted to preside at the hearing. The MOC hearing is conducted in a Newark office building, in connection with Newark filed cases. This hearing is scheduled at the Robbinsville trustee’s office, in connection with the Trenton filed cases, and in a Camden or Northfield office building, for Camden filed cases.
The chapter 13 trustee or his/her counsel conducts the hearing and asks the debtor questions. Although permitted, it is very unusual for a creditor to appear and ask questions. The hearing lasts about 8 to 15 minutes. The hearing is recorded and the debtors must bring a photo ID and proof of their social security number. The questions pertain to the following: identity of the debtors; ensuring accuracy and completeness of the petition; asset values for the bankruptcy filing; prior and future income and expenses.
The second hearing is called a Confirmation Hearing, which is always at the appropriate courthouse. The debtor need not appear at the hearing. Only the debtor’s attorney must appear at the hearing. However, creditors who object to the plan may appear. The purpose of the hearing is to ensure that the debtor’s monthly trustee payments are accurate, which typically requires a payment adjustment.
At the hearing, the trustee or his/her counsel review the following to determine the required amount of the monthly payments: debtor’s bankruptcy plan; creditors’ claims; type of debt; debtor’s asset values; and debtor’s income and expenses. If the debtor or the objecting creditor does not agree with the trustee’s recommendation, any party can request a judge to resolve any issues.
Please contact New Jersey Bankruptcy lawyer Robert Manchel, at 866.503.5655 for a free consultation and explanation as to how chapter 13 or chapter 7 bankruptcy works.

New Jersey Bankruptcy Lawyer Explains What Happens At A Chapter 7 Hearing

October 30, 2011 by Robert Manchel

A New Jersey chapter 7 bankruptcy case requires only one hearing, which is called the Meeting of Creditors (MOC) or the 341(a) hearing.
The MOC is never held in a courtroom and the judge is never present. If your case is filed In Trenton, your MOC hearing is held in the courthouse, but not in a courtroom. If your case is filed in Newark, the MOC hearing is typically held in an office building in Newark. If your case is filed in Camden, your hearing is either held in an office building in Camden or Northfield.
The hearing is conducted by the trustee that is assigned to oversee your bankruptcy case. Typically, the trustee sits at a desk facing all of the debtors. When the trustee calls the debtors’ name, the debtor must approach the desk and sit down facing the trustee. There is a recording device on the table that records all testimony. The debtors must show the trustee a photo driver’s license and a social security card to provide proof of identity. There are alternative forms of identification that are acceptable. The debtor’s attorney should put the original signed bankruptcy petition on the table.
The hearing lasts about five to ten minutes depending on the complexity. Although the hearing is called a Meeting of Creditors, it is unusual for a creditor to appear and ask questions. The trustee is mainly interested in eliciting testimony regarding the debtor’s assets, income, expenses, and reason for the bankruptcy filing. The trustee must determine if the debtor has assets with a substantial value that he may sell. Also, the trustee must ensure that the debtor’s household income is less than their monthly expenses. Furthermore, the trustee must ensure that the debtor’s financial hardship is legitimate.
Some of the questions that are asked at the Meeting of Creditors are as follows: Did you review your petition for accuracy prior to signing? Is the information in your petition correct? Do you need to change any information in your petition? Does your petition include all of your assets? When did you buy your house? How much did you pay for your house? How much is your house worth now, if you were to sell your house? Do you own stocks or bonds? Do you have a savings account? Can you sue someone for money, for any reason? What is the reason for filing bankruptcy? Are you working? Has your income changed from the time of the bankruptcy filing?
Please contact NJ Chapter 7 Bankruptcy Lawyer Robert Manchel at 1 (866) 503-5655 to discuss the process for chapter 7 bankruptcy protection.

Manchel
New Jersey
Bankruptcy Law

Retirement Plans, Pensions And Bankruptcy – Explained By A NJ Bankruptcy Lawyer

What Happens To Debt Incurred After A New Jersey Bankruptcy Filing?

Bankruptcy Debt Counseling – Discussed By A New Jersey Bankruptcy Attorney

Do You Have To Include All Creditors If You File For Bankruptcy in NJ?

Chapter 13 Hearings Explained By New Jersey Bankruptcy Lawyer

NJ Attorney For Chapter 13 Bankruptcy Hearings

New Jersey Bankruptcy Lawyer Explains What Happens At A Chapter 7 Hearing

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Manchel
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Bankruptcy Law