Chapter 13

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; ensure accuracy and completeness of the petition; asset values; 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 debtors’ 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 debtors’ 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: debtors’ bankruptcy plan; creditors’ claims; type of debt; debtors’ asset values; and, debtors’ 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 the New Jersey Bankruptcy lawyer Robert Manchel, at 866.503.5655, for a free consultation and explanation as to how chapter 13 works.

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In a chapter 13 case, the debtor must make monthly payments to a trustee for 36 to 60 months. The monthly trustee payment is based on numerous criteria. A chapter 13 case is typically comprised of different classes of debt (i.e. priority, secured, unsecured). Certain type of debt such as priority (i.e. child support, certain taxes) must be paid through a chapter 13 bankruptcy plan, no matter the circumstances. The debtor must pay this debt and prove sufficient monthly disposable income to pay such debt. Payment of this debt cannot be eliminated.

A substantial part of the bankruptcy code deals with the various analysis’ that determine the portion of the unsecured debt (i.e. credit card debt) that must be paid. A debtor must pay no less than their unexempt equity in property, towards the aggregate amount of unsecured debt, through monthly bankruptcy installments. In other words, if the debtor has real estate or personal property with a substantial value, the debtor is required to pay towards the total unsecured debt, over the plan’s life, the property’s fair market value minus bankruptcy exemptions. It is not typical that any debtor has property with substantial value. However, generally, in the event that a debtors’ monthly trustee payment is based on this criteria, the monthly payment can never be modified to reduce the amount that is to be paid to the unsecured creditors.

Also, in general, the debtor must pay no less than all of their monthly disposable income to the trustee, unless payment of 100% to all unsecured creditors will require a monthly payment of less than all of the debtors’ monthly disposable income. Monthly disposable income is net income minus necessary expenses, such as mortgage, food, clothing, transportation, utilities, etc. Monthly disposable income is based on two analysis’. If a debtors’ payment is based on monthly disposable income and there is a substantial change in circumstances regarding income or expenses, the monthly payment may be modified to the changed monthly disposable income.

A debtor can include in a chapter 13 bankruptcy case, a certain amount of secured debt. For example, a debtor may save their house from foreclosure by curing the arrears through the bankruptcy plan, while maintaining monthly payments directly to the mortgage company. A debtor may save their auto from repossession, by paying their auto arrears through the bankruptcy plan. Typically, if a debtor is no longer able to afford the trustee payments that include mortgage or auto finance arrears, he may wish to surrender the property and reduce the monthly payment. However, the debtor must continue to pay all disposable income through the plan.

You may contact theBankruptcy Lawyer in New Jersey, Robert Manchel, at 1 (866) 503-5655, to discuss your chapter 13 payments.

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A person cannot file a subsequent chapter 7 case, within eight years of the filing of the prior chapter 7 case, that received a discharge. In other words, if a person received a chapter 7 discharge, the debtor cannot receive another chapter 7 discharge unless the subsequent chapter 7 is filed at least eight years from the date of the filing of the prior chapter 7case, that was discharged.

A debtor that received a prior chapter 13 discharge can obtain a subsequent chapter 7 discharge, if the prior chapter 7 case was filed at least six years before the filing of the present chapter 13 bankruptcy case. However, there are exceptions as to when a person may file for a chapter 7, after a chapter 13 discharge. The exceptions are as follows: The debtor paid all unsecured debt through their chapter 13 case: or, paid 70% of the unsecured debt and the plan was proposed in good faith, in addition to applying his best efforts.

A chapter 13 debtor who filed and received a prior chapter 7 discharge, within four years, of the subsequent chapter 13 filing, will not receive a discharge of any debt that is not paid through the present chapter 13 plan. Please note that the debtor can file the chapter 13 case, under this scenario, but the debtor will not receive a discharge for debt that is not paid through the subsequent chapter 13 filing.

A chapter 13 debtor who filed and received a prior chapter 13 discharge in connection with the prior case that was filed within two years of the subsequent chapter 13 filing, will not receive a discharge of any debt that is not paid through the subsequent chapter 13 plan. Please note that the debtor can file the chapter 13, under this scenario, but the debtor will not receive a discharge for any unpaid debt.

A debtor that files a chapter 13 or chapter 7 case after the dismissal of a prior chapter 7 or chapter 13 case, within one year of the subsequent chapter 13 or chapter 7 filing, may need to meet certain criteria to continue the subsequent case.

TheNew Jersey Bankruptcy Practitioner, Robert Manchel, can be reached at 1 (866) 503-5655, to discuss whether you can file a subsequent bankruptcy case.

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The number of months of a chapter 13 bankruptcy plan depends on numerous factors, including, the value of assets, amount of monthly disposable income, and the reason for the filing. The bankruptcy code requires a debtor to pay no less than all monthly disposable income to a trustee for at least 36 months. If the debtors’ household income for the six months prior to the filing is more than the average income of a household of the same size in New Jersey, most likely the plan will be 60 months. In other circumstances, the length of the plan may be between 36 to 60 months.

If the debtor has property worth a substantial value that is in excess of their bankruptcy exemptions and costs to sell the property, the amount of the unexempt property value must be paid to the trustee over the life of the bankruptcy plan. Although unusual, if the debtor has personal property or real estate that has substantial value, the debtor will likely be required to pay additional funds to the trustee over the life of the bankruptcy plan. Under this scenario, the debtor may require a longer monthly plan, to allow for the additional funds that must be paid. The debtor may wish for a plan longer than 36 months to allow for payment of these funds over a longer period.

Also, a debtor may wish to file a chapter 13 case for a number of reasons, such as to cure mortgage, auto, support, or income tax arrears. The funds that are required to cure certain arrears may require substantial payments, that will be reduced by extending the months of the plan. Under this Scenario, assuming that all disposable funds are paid to the trustee on a monthly basis, the debtor may wish to extend the months of a plan, to a period between 36 to 60 months.

The numerous issues related to a chapter 13 are involved and the above explanation is extremely simplified. In fact, the number of months of a plan, is effected by numerous factors, and the amount of months of a plan may be modified.

Please contact the NJ. Bankruptcy Lawyer, Robert Manchel, at 1 (866) 503-5655, to discuss your chapter 13 bankruptcy questions.

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A Chapter 13 Bankruptcy case can save a house from foreclosure. Immediately upon the filing of a chapter 13, the foreclosure action stops immediately. The total amount of the mortgage arrears must be paid to the mortgage company through a monthly trustee payment.

In addition to the trustee payment, the debtor must continue to pay their monthly mortgage payments directly to the mortgage company. The trustee plan payments should last for approximately sixty months. After the completion of the bankruptcy plan, the debtor should be current with all mortgage arrears.

If you have questions about bankruptcy, and wish to speak with a bankruptcy attorney in New Jersey, please contact me at (856) 797-1500 for a free consultation.

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Many residents assume that filing for bankruptcy and having fair debt collection in New Jersey is a complicated process. For the most part, they’re right. However, an experienced New Jersey bankruptcy attorney will help you understand the filing process, while always keeping your best interests in mind.

According to www.uscourts.gov, the Chapter 13 bankruptcy process is begun by filing a petition with the local bankruptcy court. The petition must include the following:

• a listing of assets and liabilities
• a listing of income and expenses
• a listing of contracts and unexpired leases
• a statement explaining the individual’s financial affairs

A bankruptcy attorney will acquire this information, in addition to income tax documents, pay stubs, and other relevant documentation, that must be prepared, prior to filing the petition with the court. The attorney should reduce the clients’ stress by ensuring the client that the petition is properly prepared. Furthermore, prior to filing the petition, the individual must complete a special type of credit counseling that is tailored for debtors who intend to file for bankruptcy protection.

A chapter 13 bankruptcy petition, includes a plan, which is not required for a chapter 7 bankruptcy case. The plan reflects the amount of the monthly payments, the length of the payments, and the creditors who are entitled to receive the funds.

Within a day or two after the filing, the court schedules two hearings. The first hearing is named the Meeting of Creditors or 341(a) hearing. Although the hearing is named a “Meeting of Creditors” it is unusual for any creditor to appear. Typically, the only individuals appearing at the hearing is the trustee or trustee’s counsel, the debtors, and their attorney. The trustee asks various questions about the debtors’ assets, liabilities, income and expenses. The 341(a) hearing is never held in a courtroom with a judge. Typically, the hearing is held in an office building and not the courthouse.

The second hearing is called a Confirmation Hearing. The debtor does not appear at this hearing. Typically, the trustee, the debtors’ attorney, and the creditors’ attorneys appear at this hearing. This hearing is held in a courtroom. At this hearing, the trustee reviews all information provided by the creditors and debtors. The trustee sets the monthly payment, which is adjusted based on the information provided.

Filing for Chapter 13 bankruptcy in New Jersey can be an intricate process. For more information about filing and your options, please contact the Law Offices of Robert Manchel. As an experienced New Jersey Chapter 13 bankruptcy lawyer, Robert Manchel will help you make the best possible decisions based on your circumstances. Call 866-503-5655 today.

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New Jersey Chapter 13 Bankruptcy is referred to as debt reorganization. A chapter 13 debtor must create a plan, which requires monthly payments to a trustee over a period of 36 to 60 months. The amount of the monthly payment and the creditors that must receive funds are based on a number of criteria, including: income, expenses, assets, liabilities, etc. The plan must include how each creditor is to be treated or paid. A chapter 13 will save an individuals’ house from foreclosure. If a debtor is involved with a mortgage foreclosure action, the bankruptcy laws require the debtor to pay the pre-filing mortgage arrears to the trustee through the plan payments. In addition to the trustee payments, the debtor is required to make their regular monthly mortgage payments.

It is important to note that although the Chapter 13 bankruptcy plan in New Jersey must specify how each creditor is to be treated (paid), the debtor may not be required to make payments to certain creditors, such as unsecured creditors, (i.e. credit cards). Unlike unsecured debt, the debtor must pay priority debt, through the bankruptcy plan. Priority debt can be an income liability or child support arrears. The bankruptcy trustee monitors the debtors’ monthly payments to ensure that payments are made, each month, on a timely basis.

Chapter 13 bankruptcy process in New Jersey is very flexible. The debtor is permitted to sell their house and modify their mortgage loan through the plan. Also, an individual is permitted to surrender their automobile and possibly discharge the loan balance. Furthermore, the debtor may request to modify their bankruptcy plan for any legal reason, that is approved by the trustee, who is administering the case.

To access more helpful information regarding whether filing for Chapter 13 bankruptcy in New Jersey is the best solution for you, please call New Jersey Chapter 13 bankruptcy attorney Robert Manchel at 866-503-5655 or visit http://www.bankruptcylawyer-nj.com.

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