If you’re considering filing bankruptcy in Paterson, NJ, you’ll need to understand the types, costs, as well as some helpful advice to finding good attorneys.

Am I Qualified for Bankruptcy?

Qualifying for bankruptcy in Paterson, New Jersey, or anywhere else in the United States, is a complex process governed by federal law. Bankruptcy laws are designed to provide individuals and businesses with a fresh financial start when they are overwhelmed by debt. To determine if you qualify for bankruptcy in Paterson, NJ, it’s important to understand the two primary types of consumer bankruptcies: Chapter 7 and Chapter 13. Each has its own eligibility criteria and requirements.

Chapter 7 Bankruptcy:

Chapter 7 bankruptcy is often referred to as “liquidation bankruptcy” because it involves the sale of non-exempt assets to pay off creditors before discharging most unsecured debts. To qualify for Chapter 7 bankruptcy in Paterson, NJ, you must meet specific criteria:

1. Means Test: The Means Test is a crucial step in determining your eligibility for Chapter 7 bankruptcy. It evaluates your income, expenses, and family size to determine if you have sufficient disposable income to repay a portion of your debts. If your income is below the state’s median income for a household of your size, you typically pass the Means Test automatically. If your income exceeds the median, you may still qualify if you can demonstrate that you have limited disposable income after accounting for necessary expenses.
2. Credit Counseling: Before filing for Chapter 7 bankruptcy, you must complete a credit counseling course from an approved agency within 180 days of filing.
3. Previous Bankruptcy Discharge: If you previously received a Chapter 7 discharge, you must wait eight years from the date of your previous filing to file for Chapter 7 again.
4. No Fraudulent Activity: You must not have engaged in fraudulent or illegal activities related to your debts or bankruptcy petition.
5. Court Approval: Ultimately, the bankruptcy court in Paterson, NJ, will review your financial situation and determine if you qualify for Chapter 7 bankruptcy based on the factors mentioned above.

Chapter 13 Bankruptcy:

Chapter 13 bankruptcy is a debt repayment plan that allows individuals to restructure their debts and pay them off over a period of three to five years. To qualify for Chapter 13 bankruptcy in Paterson, NJ, you must meet certain criteria:

1. Regular Income: You must have a regular source of income that is sufficient to cover your living expenses and proposed Chapter 13 repayment plan.
2. Debt Limitations: There are debt limits for Chapter 13 bankruptcy. These limits are subject to change with inflation adjustments.
3. Filing Requirements: Similar to Chapter 7 bankruptcy, you must complete credit counseling before filing for Chapter 13 and submit a proposed repayment plan to the court.
4. Previous Filings: If you previously filed for Chapter 13 bankruptcy, you may still qualify for a new Chapter 13 case, but the timing and terms will depend on the specifics of your previous case.
5. No Fraudulent Activity: As with Chapter 7, you must not have engaged in fraudulent or illegal activities related to your debts or bankruptcy petition.

It’s important to note that bankruptcy laws can change over time, and the specific requirements and limits may have changed. Therefore, it’s advisable to consult with a qualified bankruptcy attorney in Paterson, NJ, who can provide you with the most up-to-date information and guide you through the bankruptcy process.

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Do You Need a Lawyer to File For Bankruptcy in Paterson, NJ?

Filing for bankruptcy in Paterson, New Jersey, is a complex legal process that involves numerous forms, financial disclosures, and court appearances. While it is not legally required to have a lawyer to file for bankruptcy, there are several compelling reasons why hiring an experienced bankruptcy attorney is highly advisable:

1. Understanding the Law: Bankruptcy law is intricate and subject to frequent changes. A qualified bankruptcy attorney in Paterson, NJ, possesses the knowledge and expertise to navigate these complexities, ensuring that your case adheres to all legal requirements.
2. Assessment of Eligibility: Determining your eligibility for bankruptcy, as discussed in the previous response, can be challenging. An attorney can help you assess whether you qualify for Chapter 7 or Chapter 13 bankruptcy and can advise you on which option is most suitable for your specific financial situation.
3. Guidance Through the Process: Bankruptcy involves a series of steps, from preparing and filing the necessary paperwork to attending hearings and meeting deadlines. An attorney will guide you through each phase, ensuring that you complete all required tasks correctly and on time.
4. Debt Evaluation: An attorney will thoroughly review your debts, assets, and income to help you make informed decisions about which debts can be discharged and which must be repaid. This analysis can significantly impact your financial future.
5. Protection from Creditors: Once you hire an attorney and file for bankruptcy, an automatic stay goes into effect, which prohibits most creditors from pursuing collection actions against you. Your attorney can communicate with creditors on your behalf, relieving you of the stress of dealing with collection efforts.
6. Avoiding Costly Mistakes: Filing for bankruptcy without legal representation can lead to costly errors, including the potential for dismissal of your case. An attorney will help you avoid such mistakes and ensure that your case progresses smoothly.
7. Maximizing Exemptions: Bankruptcy exemptions allow you to protect certain assets from liquidation. An attorney can help you understand and apply these exemptions effectively, allowing you to keep valuable property while still receiving debt relief.
8. Negotiating with Creditors: In some cases, your attorney may be able to negotiate with creditors outside of bankruptcy, potentially reducing the amount of debt you owe or arranging more favorable repayment terms.
9. Customized Repayment Plans: In Chapter 13 bankruptcy, your attorney will assist in creating a feasible repayment plan that aligns with your income and financial goals, increasing the likelihood of success.
10. Legal Advocacy: If disputes arise during the bankruptcy process, such as objections from creditors or issues with the bankruptcy trustee, your attorney will serve as your advocate in court, working to resolve conflicts in your favor.

While hiring an attorney is highly recommended for the reasons mentioned above, it’s also important to consider the cost associated with legal representation. Attorneys typically charge fees for their services, which can vary based on the complexity of your case and your location. However, many individuals find that the benefits of hiring an attorney far outweigh the costs, as it can ultimately lead to a smoother and more successful bankruptcy process.

Cost to File Chapter 7 Bankruptcy in Paterson, NJ

The cost to file for Chapter 7 bankruptcy in Paterson, New Jersey, involves several fees and expenses, and it’s important to be aware of these costs before initiating the process. Here’s an explanation of the key expenses associated with filing Chapter 7 bankruptcy in Paterson:

1. Filing Fee: The primary fee you’ll encounter when filing for Chapter 7 bankruptcy is the filing fee, which is payable to the U.S. Bankruptcy Court. The filing fee for Chapter 7 bankruptcy in Paterson, NJ, is $378. However, this fee is subject to change, so it’s crucial to check the most current fee schedule on the official website of the U.S. Bankruptcy Court for the District of New Jersey or consult with a bankruptcy attorney for the latest information.
2. Credit Counseling Course: Before filing for bankruptcy, you are required to complete a credit counseling course from an approved agency. This course typically costs between $29 and $60 and must be paid separately.
3. Chapter 7 Attorney Fees: While it’s not mandatory to hire an attorney to file for Chapter 7 bankruptcy, it is highly recommended. Attorneys who specialize in bankruptcy cases charge fees for their services. The cost of legal representation can vary widely depending on factors such as the complexity of your case and the attorney’s experience. On average, you can expect attorney fees for a Chapter 7 bankruptcy in Paterson to range from $1,180 to $2,920 or more. Some attorneys offer payment plans to make their services more accessible.
4. Credit Report and Miscellaneous Costs: It’s essential to obtain a copy of your credit report from all three major credit bureaus before filing for bankruptcy. While you are entitled to one free credit report per year, you may need additional reports for accuracy. The cost of each credit report can vary but is typically under $26 per report. Additionally, there may be miscellaneous costs associated with gathering necessary documents and paperwork for your bankruptcy case.
5. Exemption Costs: In a Chapter 7 bankruptcy, you can claim exemptions to protect certain assets from liquidation. If you need to appraise or value these assets, there may be associated costs. It’s advisable to consult with your attorney to determine if this is necessary in your case.
6. Post-Filing Debtor Education Course: After filing for Chapter 7 bankruptcy, you must complete a debtor education course. The cost of this course can range from $32 to $65 and must be paid separately.
7. Transportation and Legal Representation: Depending on your circumstances, you may need to attend one or more meetings with creditors (341 meeting) or court hearings. Consider the cost of transportation to and from these meetings, as well as any additional legal representation if required.

The cost of filing for Chapter 7 bankruptcy in Paterson, NJ, can vary widely depending on individual factors. To get a more accurate estimate of the costs involved in your specific situation, it’s advisable to consult with a bankruptcy attorney who can provide you with a detailed breakdown of expenses and guide you through the bankruptcy process.

Cost to File Chapter 11 Bankruptcy in Paterson, NJ

Filing for Chapter 11 bankruptcy in Paterson, New Jersey, can be significantly more expensive and complex than filing for Chapter 7 or Chapter 13 bankruptcy due to its focus on business reorganization. Chapter 11 bankruptcy is typically used by businesses, including corporations, partnerships, and some individuals with substantial debts. The cost of filing for Chapter 11 bankruptcy varies widely based on the size and complexity of the case. Here’s an explanation of the key expenses and factors to consider:

1. Filing Fee: The filing fee for Chapter 11 bankruptcy in Paterson, NJ, is determined by the U.S. Bankruptcy Court and can be substantial. However, this fee is subject to change, so it’s essential to check the most current fee schedule on the official website of the U.S. Bankruptcy Court for the District of New Jersey.
2. Attorney Fees: Filing for Chapter 11 bankruptcy requires extensive legal expertise and representation. Businesses and individuals seeking Chapter 11 protection usually engage experienced bankruptcy attorneys who charge significant fees for their services. Attorney fees for Chapter 11 cases can vary widely based on the complexity of the case, the number of creditors involved, and the legal work required. It’s not uncommon for attorney fees to reach tens of thousands of dollars, and in more complex cases, they can be substantially higher.
3. Retainer: Bankruptcy attorneys handling Chapter 11 cases often require clients to pay a substantial upfront retainer fee. This fee serves as a deposit against future legal services and costs.
4. Administrative Costs: Chapter 11 cases involve ongoing administrative costs, including filing various motions, attending hearings, and managing the day-to-day operations of the business during the bankruptcy process. These administrative costs can add up over the course of the case.
5. Creditors’ Committee: In some Chapter 11 cases, a creditors’ committee may be formed to represent the interests of unsecured creditors. The costs associated with the committee, such as legal and professional fees, may be paid from the bankruptcy estate.
6. Financial Advisors and Experts: In complex Chapter 11 cases, it may be necessary to hire financial advisors, accountants, or other experts to assist in developing a feasible reorganization plan. These professionals charge fees for their services.
7. Post-Petition Debts: During the bankruptcy process, the debtor (business or individual) is responsible for post-petition debts, including ongoing operating expenses such as payroll, rent, and utilities.
8. Plan Confirmation: Developing and confirming a Chapter 11 reorganization plan is a critical and costly aspect of the process. Legal and financial professionals may be involved in preparing and negotiating the plan.
9. U.S. Trustee Fees: The U.S. Trustee’s Office charges quarterly fees based on the debtor’s disbursements during the case. These fees are intended to cover the cost of oversight and administration.
10. Retirement and Employee Benefits: Businesses may need to address employee pension and benefit plans as part of the Chapter 11 process, which can result in additional costs.

Due to the significant expenses involved in Chapter 11 bankruptcy, it’s essential for businesses and individuals considering this option to thoroughly evaluate their financial situation and consult with experienced bankruptcy attorneys. Attorneys can provide a detailed estimate of the expected costs based on the specifics of the case. Additionally, they can help explore alternative options, such as out-of-court workouts or Chapter 7 liquidation, if Chapter 11 proves to be financially unfeasible.

Cost to File Chapter 13 Bankruptcy in Paterson, NJ

Filing for Chapter 13 bankruptcy in Paterson, New Jersey, involves various fees and costs, and understanding these expenses is essential when considering this form of bankruptcy, which is designed for individuals with regular income who want to reorganize their debts. Here’s an explanation of the key costs associated with filing Chapter 13 bankruptcy in Paterson:

1. Filing Fee: The primary cost when filing for Chapter 13 bankruptcy is the filing fee, payable to the U.S. Bankruptcy Court. However, this fee can change over time, so it’s essential to verify the most current fee schedule on the official website of the U.S. Bankruptcy Court for the District of New Jersey.
2. Credit Counseling Course: Before initiating a Chapter 13 case, you must complete a credit counseling course from an approved agency. This course typically costs between $29 and $70 and must be paid separately.
3. Attorney Fees: While it is possible to file for Chapter 13 bankruptcy without an attorney (known as “pro se” filing), it is highly advisable to hire an experienced bankruptcy attorney. Attorney fees for Chapter 13 cases can vary widely based on factors such as the complexity of your case and your location. On average, you can expect attorney fees for a Chapter 13 bankruptcy in Paterson to range from $2,900 to $4,840 or more. Some attorneys offer payment plans to make their services more accessible.
4. Chapter 13 Plan Payments: In a Chapter 13 case, you are required to propose a repayment plan that outlines how you intend to pay off your debts over a period of three to five years. The plan payments will include your monthly payment to the bankruptcy trustee, who will distribute funds to your creditors. The total amount of these plan payments will depend on your disposable income, debts, and other factors.
5. Post-Filing Debtor Education Course: After filing for Chapter 13 bankruptcy, you must complete a debtor education course. Similar to the credit counseling course, this typically costs between $32 and $70 and must be paid separately.
6. Trustee’s Fees: The Chapter 13 trustee overseeing your case is entitled to receive a fee, which is typically a percentage of the total payments made under your repayment plan. This fee is included in your monthly plan payments.
7. Miscellaneous Costs: Depending on your specific circumstances, there may be other miscellaneous costs, such as obtaining credit reports or appraising certain assets, which may add to the overall expense.

Before filing for Chapter 13 bankruptcy, it is advisable to consult with a bankruptcy attorney in Paterson, NJ, who can provide you with a detailed breakdown of the expected costs and guide you through the process, ensuring that you make informed decisions regarding your financial future.

Reliable Bankruptcy Attorneys in Paterson, NJ

Below is a list of reputable bankruptcy attorneys in Paterson, NJ. They can help you with both personal and business bankruptcy information.

Joseph Chang LLC
951 Madison Ave, Paterson, NJ 07513, United States

Salomon & Aquino, LLC
100 Hamilton Plaza # 1402, Paterson, NJ 07505, United States

Goldman & Beslow, LLC
100 Hamilton Plaza #405, Paterson, NJ 07510, United States

Raff & Raff, LLP
30 Church St, Paterson, NJ 07505, United States

The Law Office of Gerard A. Nisivoccia, Esq.
168 Market St, Paterson, NJ 07505, United States

Paterson, NJ Zip Codes We Proudly Serve:

07501, 07502, 07503, 07504, 07505, 07513, 07514, 07522, 07524

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