Camden NJ Bankruptcy Law Blog

Willingboro New Jersey Bankruptcy Attorney

The Law Office of Robert Braverman, LLC has recently opened a law office at 200 Campbell Drive, Willingboro New Jersey to better serve the individuals and businesses of Willingboro and nearby cities such as Westampton, Willingboro and Burlington City, NJ. Assisting clients with financial issues in bankruptcy, including Chapter 7, Chapter 13, Chapter 11 and Chapter 12 and debt negotiation will remain the primary focus of the law firm.

Personal Bankruptcies Down 50%

Personal bankruptcy filings have dropped by 50-percent over the past six years. There are a number of reasons for this decline in bankruptcy filings. Unemployment is down which is typically a factor. In addition, according to ABC,(Margot Kim http://abc30.com/finance/medical-bankruptcies/2252646/ ), outstanding medical debt has dropped as a result of the Affordable Care Act. Prexisting coverage requirements and limits on caps are two of the provisions that have contributed. The article also mentions the  'Bankruptcy Abuse Prevention and Consumer Protection Act' passed in 2005 as part of the explanation. However, I do not agree since the number of bankruptcies filed increased for a number of years after its passage and for the most part it has not prevented very many filings. Bankruptcy filings have historically been cyclical and with the next swing in the economy undoubtedly filings will rise again.

Exceptions to the Bankruptcy Automatic Stay

Most people realize that when a bankruptcy is filed, the automatic stay stops most lawsuits against the debtor. However, there are exceptions under Section 362(b). For example, a lawsuit can proceed against someone that filed bankruptcy in order to establish paternity. Lawsuits to enforce child support obligations or visitation rights can also be brought even though the defendant filed bankruptcy.

Business Debt Exception To Means Test

When the Bankruptcy Code was amended, one of the purposes was to make it more difficult for high income earners to eliminate their debt in a Chapter 7 bankruptcy. As a result, sections were added to the Bankruptcy Code which essentially  add some limitations on expenses if you make more than the average family your size in your state. However, the "means test" as it is called, only applies if the debts are "primarily" consumer debts. If your business related debts, such as debts from personal guarantees for a failed business, constitute more than 50% of your debt, the means test does not apply. This generally makes it easier to fit into a Chapter 7 bankruptcy. New Jersey courts may interpret whether a debt is a consumer or business debt differently from other states, so it is best to consult an experienced bankruptcy attorney to make this determination

What is an Involuntary Bankruptcy

An Involuntary Bankruptcy is filed not by the individual or company that has the debts, but instead by creditors of that individual or company. The involuntary bankruptcy can either be a Chapter 7 or Chapter 11 bankruptcy. Three creditors with combined claims totaling $15,775 or more can force a company into bankruptcy. The claims cannot be contingent or subject to a bona fide dispute. The filing must be in good faith or the case will be dismissed and the creditors could be responsible for fees and costs incurred by the debtor. The requesting parties must show the debtor is not paying its debts as the debts become due. Creditors will file an Involuntary Bankruptcy for various reasons including trying to force liquidation of the assets to pay its claims or to get the trustee appointed to review the books and records to make sure the debtor is not improperly favoring some creditors over other creditors.

GYMBOREE APPEARS TO BE ON VERGE OF BANKRUPTCY

Gymboree appears to be on the verge of bankruptcy according to The Denver Post. http://www.denverpost.com/2017/05/05/gymboree-stores-closing/ A number of stores will likely close as part of the bankruptcy process. A number of brick and mortar retailers have struggled in recent years. According to the Gymboree website, southern New Jersey has stores in Cherry Hill, Deptford, Marlton and Blackwood NJ. There are also stores in Philadelphia Pennsylvania. It is not yet clear which stores will be closing.

Priority Claims in Chapter 13 Bankruptcy

Chapter 13 is a type of bankruptcy often used by debtors to save their home by paying mortgage arrears over time. However, when filing Chapter 13, a debtor is obligated to pay priority claims in full through the bankruptcy as well. Priority claims include domestic support obligations such as child support, certain types of taxes, claims for personal injuries from a motor vehicle accident when driver was intoxicated, and other types of claims are priority claims. In certain circumstances, this obligation could make retaining the home more difficult since instead of paying just the mortgage arrears, these priority claims must be paid as well. However, it could also make keeping the home easier since it may be more affordable by stretching these payments out over five years.

Bankruptcy Court Approves Circus Sale

As reported by the New York Times, Big Apple Circus, which began operating in 1977, filed bankruptcy and closed in the summer of 2016. A 1.3 million dollar bid by Big Top Works to buy the debtor's assets was recently approved by the Bankruptcy Court. The circus will return in the fall of 2017. Prior to filing, a fund raising drive was used in an attempt to keep the circus going, but it fell short of its needed goals. http://www.vivacityny.com/new-york-times-big-apple-circus-sold-to-the-highest-bidder-will-return-this-fall-the-new-york-times/

Am I eligible to file Bankruptcy?

Whether you are from Pennsauken NJ or Cherry Hill New Jersey or Northeast Philadelphia Pennsylvania, individuals often come into my office and ask the same question. Am I eligible to file bankruptcy? Most times individuals are eligible to file bankruptcy. There are some limits. For example, section 109 of the bankruptcy code provides that to file a chapter 13 bankruptcy you cannot have more than $394,725.00 in unsecured debt or more than $1,184,200.00 in secured debt. If you do, you cannot file chapter 13, but you can file an individual chapter 11. Sometimes the real question is can they receive a discharge. For example, if an individual has filed a chapter 7 bankruptcy within the last 4 years, they are not eligible to receive a discharge in a chapter 13. However, that does not prevent the individual from filing a chapter 13. If they are behind with their mortgage, a chapter 13 can be used to pay mortgage arrears over 3 to 5 years even if they are not eligible for a discharge. Regarding chapter 7, a discharge will not be received if a chapter 7 is filed within 8 years of a prior chapter 7. In addition, the ability to file a chapter 7 and receive a discharge may be effected by other factors such as income compared to expenses. If an individual has too much disposable income, they could be forced to convert to chapter 7 or have their case dismissed. Equity in assets is also a factor in determining whether someone should file a chapter 7 or chapter 13 bankruptcy. Whether bankruptcy is an option and which type of bankruptcy are important issues that should be discussed with an experienced attorney before deciding how to proceed.

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