NJ Bankruptcy – Chapter 13
There are different types of bankruptcies. Consumers usually file either a Chapter 7 or Chapter 13 bankruptcy.
What kind of bankruptcy is Chapter 13?
A Chapter 13 Bankruptcy is a personal reorganization of your financial affairs. It is most typically a monthly payment plan. In some cases a Chapter 13 debtor will be required to pay very little back to his/her creditors while other debtors may be required to pay back as much as 100% of what they owe to their creditors. The two most common factors in determining the amount you need to pay back is your median/annual income and the value of your assets.
Is Chapter 13 bankruptcy a good idea?
It really depends on your specific circumstances. For example, a Chapter 13 is one of the best mechanisms to catch up on mortgage arrears. It also gives you an opportunity to apply of a loan modification in certain instances. In New Jersey, it is quite common now for Chapter 13 debtors to file bankruptcy in order to stop a foreclosure while they file for a loan modification.
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