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Can I Eliminate EZ Pass Debt In A New Jersey Bankruptcy Case.

<h2>Attorney  Explains How EZ Pass Debt Is Handled In A New Jersey Bankruptcy Case.</h2>

I have handled bankruptcy cases involving clients that have incurred a surprisingly substantial amount of EZ Pass debt. Peculiarly, most bankruptcy lawyers do not know how to handle EZ Pass Debt in bankruptcy. Also, good luck finding a state employee that understands how such debt is administered in bankruptcy.

The State of New Jersey may take the following actions in connection with EZ Pass debt. Although unusual, the state may commence a lawsuit against the debtor and obtain a judgment lien. The state may also suspend the debtor’s license and/or suspend or restrict the registration of a vehicle.

The following explanation in this and following paragraph, is based on the state not having entered a judgment lien, against the debtor, by way of a lawsuit. In general EZ Pass debt is considered unsecured debt, in a chapter 13 and/or a chapter 7 bankruptcy case. Typically, all unsecured debt is treated the same. The most common type of unsecured debt is credit card debt and a personal loan. If a bankruptcy debtor meets the criteria of a chapter 7 discharge, all of the EZ Pass debt is eliminated and discharged in the chapter 7.

This paragraph deals with EZ Pass debt, in a chapter 13, when no judgment lien was entered. I have written numerous blogs on how unsecured debt is treated in a chapter 13. All types of unsecured debt must be paid equally, if at all, in a chapter 13 bankruptcy case. Depending on the debtor’s financial circumstances, he may not be required to pay any money, whatsoever, towards the EZ Pass debt. However, if the debtor is required to pay any funds toward the EZ Pass debt, he must pay all his other unsecured debt, the same pro rata amount. You may review my other blogs that explain how unsecured debt is paid in a chapter 13.

If the state entered a judgment lien against the debtor, typically, the debt is still discharged in a chapter 7. However, all or a portion of the lien may not be eliminated, depending on the debtor’s circumstances. In other words, the discharge of a debt means that the creditor is not permitted to collect money for the debt. However, if the lien may not be eliminated, the lien must be paid when the debtor’s real estate is sold.

A lien may attach to the debtor’s real estate, under certain circumstances. Also, the lien may, possibly, be eliminated based on the value of the house, the mortgage payoff and any other judgment lien payoffs. In order to eliminate the lien in a chapter 7, an additional document must be filed with the court, requesting same. In a chapter 13, all or a portion of the lien may, possibly, be eliminated based on the debtor’s house value, mortgage payoff and the value of other liens. Any portion of the lien that may not be eliminated in a chapter 13, may be paid through the chapter 13 bankruptcy plan

Based on the debtor’s circumstances, the filing of a chapter 13 and/or chapter 7 case may permit the reinstatement of their driver’s license and the release of the vehicle’s registration suspension/restriction, after payment of the required costs. I would be interested in explaining how bankruptcy may benefit you with your EZ Pass debt.

Contact Robert Manchel at 866 503 5644 to discuss your EZ Pass debt and bankruptcy.

 

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