A simple guide for New Jersey individual and families facing financial strugges

Bankruptcy is a legal tool that may help people who cannot keep up with their debts. It can stop many collection actions, help protect property, and give you a path toward a fresh financial start. The right choice depends on your income, property, debts, and goals. Money problems can happen to anyone.
You may have lost a job. You may have faced a divorce, illness, or family emergency. Credit-card bills may have grown faster than you could pay them. You may be behind on your mortgage, car payment, or other debts.
Whatever brought you here, you are not alone and you should not feel ashamed.
At Tomes Law Firm, our New Jersey bankruptcy team looks at the whole picture. We help you understand your choices, what you may be able to protect, and whether bankruptcy is the right step for you

What Is Bankruptcy?

Bankruptcy is a legal process handled in federal court.

It is designed to help people and businesses deal with debt they cannot afford to pay. Depending on the type of bankruptcy you file, you may be able to:

• Eliminate certain debts.
• Stop many collection efforts.
• Catch up on missed payments.
• Protect important property.
• Create a more affordable payment plan.

Most individuals file either Chapter 7 or Chapter 13 bankruptcy. The best option depends on the facts of your case.

How Can Bankruptcy Help Me?

Bankruptcy may give you room to breathe.

When a bankruptcy case is filed, a legal protection called the automatic stay usually begins. This can stop or pause many collection actions while your case is pending.

Depending on your situation, bankruptcy may help stop:

• Creditor phone calls.
• Collection letters.
• Debt-collection lawsuits.
• Wage garnishments.
• Bank levies.
• Some foreclosure actions.
• Some car repossessions.
• Stop interest if you need a Chapter 13

There are limits and exceptions, so it is important to speak with a bankruptcy attorney before relying on bankruptcy to stop an urgent collection action.

Can Bankruptcy Eliminate My Debt?

Bankruptcy may eliminate many common unsecured debts, including credit-card balances, medical bills, personal loans, old utility bills, certain court judgments, and some older tax debts.

At the end of a successful bankruptcy case, the court may enter a discharge. A discharge releases you from personal responsibility for many covered debts and generally prevents creditors from trying to collect those debts from you.

Not every debt can be erased. Child support, alimony, many student loans, certain taxes, and some other debts may remain.

That does not always mean bankruptcy cannot help. Removing other debts may make it easier to handle the debts that remain.

What Is Chapter 7 Bankruptcy?

Chapter 7 is often used by people who do not have enough income to repay their unsecured debts.

It may eliminate qualifying credit-card debt, medical bills, personal loans, and other debts. Many Chapter 7 cases are completed within several months.

Chapter 7 is sometimes called a liquidation bankruptcy because a trustee can sell property that is not protected by bankruptcy exemptions. However, many people who file Chapter 7 are able to keep their basic property.

Before filing, an attorney should review your home, cars, bank accounts, income, tax refunds, personal property, and any recent payments or transfers.

Do not assume that you will lose everything. That is one of the most common fears people have, and it is often not what happens.

What Is Chapter 13 Bankruptcy?

Chapter 13 allows a person with regular income to repay some or all debts through a court-approved plan. The plan usually lasts three to five years.

Chapter 13 may help when you:

• Are behind on your mortgage.
• Need time to catch up on car payments.
• Have tax debt.
• Earn too much to qualify for Chapter 7.
• Own property that may not be fully protected in Chapter 7.
• Need an organized payment plan.

Your Chapter 13 payment is based on several factors. It is not simply the total amount of debt divided by the number of months.

Will I Lose My Home or Car?

Not necessarily.

Many people avoid calling a bankruptcy attorney because they think filing means giving up everything they own. Bankruptcy does not work that way.

Bankruptcy exemptions may protect some or all of the value in your home, car, furniture, clothing, retirement accounts, household goods, and other personal property.

Whether your property is protected depends on its value, how much you owe on it, the type of bankruptcy, and the exemptions available to you.

A careful review before filing is very important. You should not transfer, sell, hide, or give away property before speaking with an attorney. Those actions can create serious problems.

Is Bankruptcy a Sign That I Failed?

Absolutely NOT!

Bankruptcy is not a measure of your worth or character.

People fall behind for many reasons, including job loss, reduced work hours, medical problems, divorce, death in the family, business problems, rising household costs, high interest rates, and unexpected emergencies. Many famous people have filed for bankruptcy and then went on to lead successful lives caring for their families and contributing to their communities.

Many hardworking people keep paying for years because they feel guilty or embarrassed. They use one credit card to pay another. They borrow from family. They empty retirement accounts. They lose sleep and still do not reduce the debt.

Asking for help is not giving up. It is taking a responsible look at a problem that may no longer be manageable on your own.

When Should I Speak With a Bankruptcy Attorney?

You do not have to wait until everything falls apart.

It may be time to learn about your options when:

• You cannot make more than the minimum payments.
• Your balances keep growing.
• You are using credit to pay basic living costs.
• You are behind on your mortgage or car.
• A creditor has sued you.
• Your wages or bank account may be taken.
• You are borrowing from family to survive.
• You are thinking about using retirement money to pay debt.
• Debt is affecting your sleep, health, or family.

A consultation does not force you to file bankruptcy. It gives you information so you can make a better decision.

What Happens During a Bankruptcy Consultation?

At Tomes Law Firm, the first step is to listen.

We want to understand what debts you have, what you own, what income comes into your household, what collection actions are taking place, what you are most worried about, what you hope to protect, and what you want life to look like after the debt is handled.

We can then explain whether Chapter 7, Chapter 13, or another option may make sense.

You will not be judged. Our job is to help you understand the law and choose a path forward.

Can Bankruptcy Really Give Me a Fresh Start?

Bankruptcy cannot change the past, but it may change what happens next.

At Tomes Law Firm, we believe bankruptcy should not be treated as just a legal transaction. Filing the case is only one step. The larger goal is to help you move forward with a stronger financial foundation.

That is why we offer our bankruptcy clients a free class designed to help them understand how to rebuild and improve their credit after bankruptcy. Better credit may help reduce the interest rates they pay on future loans and make it easier to reach important financial goals.

We also provide information about companies that may be willing to work with people who are currently in bankruptcy or who recently completed a bankruptcy and need a reliable car. We share other financial tools and resources that may help clients build a budget, make better financial choices, and feel more confident about the future.

These resources are educational, and results can vary. We cannot promise a certain credit score, loan approval, or interest rate. But we can give you tools and guidance to help you take the next steps.

Bankruptcy may help you stop living from one collection notice to the next. It may give you the chance to rebuild your budget, improve your credit, protect your family, and begin planning for the future.

At Tomes Law Firm, we do not want bankruptcy to be only the end of a difficult chapter. We want it to be the beginning of a better one.

Frequently Asked Questions

Does filing bankruptcy stop creditors from calling?

In many cases, the automatic stay stops creditors from continuing collection efforts after the case is filed. There are exceptions, and repeat bankruptcy filings may affect the protection available.

Does bankruptcy erase every debt?

No. Many unsecured debts may be discharged, but some debts usually remain. These can include child support, alimony, many student loans, and certain taxes.

Can I keep my retirement account?

Many qualified retirement accounts are protected in bankruptcy, but every case should be reviewed before filing.

Can married people file separately?

Yes. One spouse may be able to file without the other. However, the non-filing spouse’s income, property, and joint debts may still affect the case.

Will everyone know that I filed bankruptcy?

Bankruptcy cases are public records, but they are not normally announced to your friends, neighbors, or employer. Most people will not know unless you tell them or they search court records.

Is bankruptcy only for people with no income?

No. Chapter 13 is designed for people with regular income. Some people with income also qualify for Chapter 7, depending on their household size, expenses, debts, and other facts.

You Do Not Have to Figure This Out Alone

Debt can make you feel trapped. It may seem easier to ignore the mail or hope that things improve on their own.

But waiting can sometimes lead to lawsuits, garnishments, repossessions, foreclosure activity, and even more stress.

You deserve clear answers without pressure or judgment.

Tomes Law Firm helps individuals and families throughout New Jersey understand their bankruptcy and debt-relief options. We will listen to what happened, explain what the law may allow, and help you decide what makes sense for your family.

Call Tomes Law Firm at 732-333-0681 to schedule a confidential consultation to see if you qualify for a fresh start.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.