Frank J. Fischer, Esq.  732-223-8484  x208
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Common Bankruptcy Questions
This page is meant to provide general information about Bankruptcy Law.  As laws are frequently changing, please contact Frank Fischer at 732-223-8484 x208 for the latest information regarding Bankruptcy law in New Jersey.

What is Chapter 7 bankruptcy?

Chapter 7 bankruptcy is a liquidation proceeding. The debtor turns over all non exempt property to the bankruptcy trustee, who then converts it to cash for distribution to their creditors. The debtor receives a discharge of all dischargeable debts.

Who can file a Chapter 7 bankruptcy?

  • You must reside or have a domicile, a place of business, or property in the United States or a municipality.
  • You must not have been granted a Chapter 7 discharge within the last 8 years or completed a Chapter 13 plan.
  • You must complete a credit counseling course and obtain a credit counseling certificate.
  • Your income must fall below the median level of income determined by the means test.
  • You must not have had a bankruptcy filing dismissed for cause within the last 180 days.
  • It must not be a "substantial abuse" of Chapter 7 to grant the debtor relief. Generally speaking, if after you pay the monthly expenses for necessities there is not enough money to pay the remaining monthly debts, then granting a discharge would not be an abuse of Chapter 7.
  • It would not be fundamentally unfair to grant the debtor relief under Chapter 7.

What is chapter 13 Bankruptcy?

Chapter 13 bankruptcy is a reorganization case filed by individuals who have a valuable asset, such as a home, that is not completely covered by exemptions and that they wish to keep. The most common reason for debtors filing Chapter 13 is to stop foreclosure proceedings  and save their home.   In Chapter 13 a debtor proposes a plan to repay creditors over a three to five year period during which the debtor can make up overdue payments on any assets and pay into the plan the equivalent value of any assets not covered by exemptions. Since the debtors plan will require regular monthly or biweekly payments, Chapter 13 is usually only appropriate for an individual debtor who has a regular source of income.

What is the difference between Chapters 7, 13 and 11?

A Chapter 7 is a straight liquidation. You are allowed to keep a limited amount of property (equity in your home up to $18,450.00 per debtor, double if for a husband and wife; clothing, furniture, car, pension). The rest goes to your creditors. In most cases, the Debtor does not own anything beyond what can be protected. A Chapter 13 is an individual repayment plan. It allows a Debtor to pay his creditors over time. A Chapter 13 filing is a good solution for someone who is behind on their mortgage payments, or taxes, or car payments. It gives the Debtor time to catch up. The Debtor, however, must be able to keep current on the new monthly payments. A Chapter 11 is for individuals whose debts exceed the limits for Chapter 13 or who have valuable assets that they want to reorganize and use to pay creditors.


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Frank J. Fischer
25 Abe Voorhees Dr
Manasquan, NJ 08736
732-223-8484 x208