If you’re like most people who are struggling with debt, then you’re probably trying to find ways to reduce your debt and cash outlays. If you’re considering filing Chapter 7 or Chapter 13 bankruptcy, then you must be thinking that the last thing you need is to pay for a bankruptcy lawyer to see you through the process. While bankruptcy lawyers usually do collect some of their fees in advance, the cost of a lawyer is more than justified by the services that they provide during the process.
How Bankruptcy Attorneys Are Paid
Bankruptcy lawyers know that their clients don’t have a great deal of disposable income. If they weren’t aware of this fact, they wouldn’t be in business for long. While most bankruptcy lawyers do collect a portion of their fees up front, they are able to collect the rest of their fees from your bankruptcy plan. In Chapter 7, that means that they will collect their fees once you liquidate your assets. With Chapter 13, the attorney will collect payment through your three-year to five-year payment plan. So, while you do need some money in the beginning, you don’t have to tackle the whole amount during a time when you’re drowning in debt.
The Complexities Of Bankruptcy
The New Jersey bankruptcy courts do not require petitioners to be represented by a New Jersey bankruptcy attorney. However, they do recommend representation because they recognize how complicated bankruptcies can be. Here are some of the things that your bankruptcy lawyer will need to do for you.
If You Are Filing Chapter 7
● Itemize all of your debts and assets
● File for Chapter 7 bankruptcy
● Notify your creditors of the bankruptcy
● File complaints with the court if a creditor violates the automatic stay
● Attend your 341 “meeting of creditors” with you
● Arrange credit counseling classes
● Oversee the liquidation of your assets and discharge of your debts
If You are Filing Chapter 13
● Itemize all of your debts and assets
● File for Chapter 13 bankruptcy
● Notify your creditors of the bankruptcy
● File complaints with the court if a creditor violates the automatic stay
● Negotiate down debts with your creditors
● Develop a three-year to five-year payment plan
● Attend your 341 “meeting of creditors” with you
● Arrange credit counseling classes
● Oversee the liquidation of your assets and discharge of your debts
In addition to these essential services, they can offer you legal guidance and advice with regard to the areas of the law where you do have a little leeway.
Frequently Asked Questions About Bankruptcy Lawyers
The following questions are commonly asked by individuals filing for bankruptcy in New Jersey.
What Determines Whether I File For Chapter 7 Or Chapter 13?
If your income exceeds the New Jersey state median income (or the median income in your state), you won’t be eligible for Chapter 7. You will have to consider filing for a Chapter 13 bankruptcy.
Can I Keep My House Or Car?
With Chapter 13 income, you’re not required to liquidate your assets. You can usually protect your house or car under your payment plan if you’re not in foreclosure. With Chapter 7, your house may be sold if you have equity in it to pay your debt.
The Law Office of Stuart M. Nachbar, P.C. offers bankruptcy advice to clients in New Jersey. Call if you have any questions.
