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Our Offices

  • Vernon Office

    Address

    244 State Hwy 94
    Vernon, New Jersey 07462

  • Wayne Office

    Address

    73 Mountainview Blvd
    Wayne, New Jersey 07470

    Phone

    973-764-1633

  • Pompton Lakes Office

    Address

    58 Colfax Avenue #1
    Pompton Lakes, New Jersey 07442

  • Hackensack Office

    Address

    41 Main Street
    Suite 2
    Hackensack, New Jersey 07601

    Phone

    973-764-1633

  • Nutley Office

    Address

    345 Centre Street
    Suite 2
    Nutley, New Jersey 07110

    Phone

    973-764-1633

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  • Blog >
  • Keys to a Successful Chapter 13 Bankruptcy

Keys to a Successful Chapter 13 Bankruptcy

A Chapter 13 bankruptcy is intended to allow individuals with regular income to adopt a plan for repaying a portion of their debts over an extended period of time, with the remainder then being discharged. This form of bankruptcy is a good option for people who cannot establish eligibility for a Chapter 7 bankruptcy or who want to protect their homes or other valuable property from foreclosure.

If you are considering Chapter 13, there are qualification requirements you must observe and steps you should take to improve the chances of successful outcome. Here are key aspects to consider:

  • Eligibility — To qualify for a Chapter 13 bankruptcy, your unsecured debts must be less than $394,725 and your secured debts, such a home mortgage, must be less than $1,184,200. You also must show you have sufficient disposable income — after your projected monthly living expenses — to make steady payments over an "applicable commitment period," which may anywhere from three to five years.
  • Plan structure — A Chapter 13 plan will detail how much you'll pay to your unsecured creditors each month. These creditors must receive at least as much under the plan as they would under Chapter 7. Once your plan is in place, you'll need to make sure that you make all of your payments on time and in full. If you're unable to do so, you may need to adjust your budget or consider other options, such as seeking loan modification.
  • Preparation for court — You need to be ready to defend your proposed plan against possible objections in court. The first court appearance in a Chapter 13 bankruptcy is the 341 meeting of creditors. The trustee in your case will ask you questions about your paperwork and allow any creditors in attendance to ask questions and raise objections. The second court appearance is the confirmation hearing, where the judge will decide whether your plan should be approved, with or without modifications. You have an opportunity to be heard at each of these hearings.
  • Unanticipated situations — Even if you're making payments on time under the Chapter 13 plan, your ability to pay may be disrupted by an emergency or an unexpected expense. A bankruptcy court may allow you more time to make payments, reduce the amount of your payments, or temporarily suspend the plan payments. Filing for Chapter 7 bankruptcy also may be an option.

Chapter 13 is a complicated process that should not be attempted without guidance from a qualified bankruptcy attorney, who can help you develop a plan that is manageable, affordable and most likely to give you an improved financial posture once the case is complete.

For more than 30 years, the Law Offices of James C. Zimmermann has been helping New Jersey debtors resolve their problems and get back on their feet financially. We have offices in Vernon, Wayne, Pompton Lakes, Hackensack and Nutley. Call 973-764-1633 or contact us online to arrange a free consultation.