New Jersey consumers who find themselves with mountains of debts may be overwhelmed by the many suggestions by friends and family who are eager to give advice on how to remedy the situation. One of the options — and possibly the most effective one — is personal bankruptcy. However, certain myths about bankruptcy may cause procrastination.
Some people may be concerned that filing for bankruptcy may negatively affect a spouse but this is only true if the unpaid debt is in the names of both spouses. In such cases, both spouses are responsible and, if only one files for bankruptcy, creditors can demand full payment from the other spouse. The solution is for the couple to file together. Another myth is that an individual can only file for bankruptcy once. This is also untrue, and, although there are limitations, subsequent bankruptcy filings are allowed.
Some individuals believe that bankruptcy can just be declared without any legal proceedings — not true. There are specific legal proceedings involved, even before filing for bankruptcy. Consumers may also find comfort in learning that it is not true that they can go to jail for debt, even if debt collectors threaten them with such action.
The circumstances of each person are unique, and the best action may be to consult with an experienced New Jersey bankruptcy attorney. Chapter 13 may be an option for those with a regular income who need to extend payment periods without giving up property. The option that could suit individuals with no income may be Chapter 7. Although some assets may be liquidated in this option, some unsecured debts, such as credit card debts, may be discharged. After assessing all the relevant information, a lawyer can explain the requirements and proceedings relative to the different bankruptcy options, and this knowledge can assist an individual in making informed decisions that can ultimately lead to financial stability.
Source: quickanddirtytips.com, “Should You File Bankruptcy?“, Laura Adams, Accessed on Oct. 15, 2015