Many New Jersey residents become overwhelmed by debt and decide to file for bankruptcy. However, knowing which form of bankruptcy to file can present a challenge. Significant differences exist between the two main chapters of bankruptcy filed by individuals -- Chapter 7 and Chapter 13.
Sometimes the first thing in the morning or the last thing at night that many New Jersey residents do is receive calls from creditors or debt collection agencies. Debt collectors can be relentless in their efforts to get individuals to pay. However, it is possible to stop harassing phone calls from creditors, and how that is done depends on each individual's financial circumstances.
On Dec. 31 of last year, the Mortgage Forgiveness Debt Relief Act, which made it possible for many homeowners to avoid paying taxes on debt forgiveness due to foreclosure or short sale, expired. Many are hopeful that Congress will renew the Act, which became law in 2007. Even though the law appears to have sufficient support, Congress has yet to make a determination regarding renewal of it. This has -- and may -- cause numerous homeowners in New Jersey and across the country to file for bankruptcy after a short sale of their homes.
Anyone in New Jersey who has been to a doctor recently, paid an insurance premium or obtained a prescription understands the rising costs of medical care in the United States. In fact, many bankruptcy filings are due to medical debt -- either directly or indirectly. Patients who suffer from chronic conditions requiring monthly regimens of pills most likely feel as if there is no end in sight to their financial obligations.