New Jersey Bankruptcy Law (NJ)

How New Jersey laws changed in response to recent Code amendments

The State of New Jersey is unique in that no homestead allowance is available in bankruptcy under the state statute, however, the homestead exemption provided under Section522 of the Code is available. The amount of the exemption is tie\d to the consumer price index and changes regularly, and is considered to be below average of other state exemptions.

One the most noted changes in New Jersey bankruptcy files is the addition of new Chapter 7 filing limitations. Several new tests were created to limit disposable income, require extensive debts, and force filers into Chapter 13 in all but the most extreme circumstances. These new laws passed with haste, and as such failed to compressively ban Chapter 7 for many individuals under the initial purview of the means testing statute. As a result, in practice, many debtors may still qualify for full and complete discharge of all debts when carefully qualifying their filing over a period of more than 60 days. Pre-bankruptcy planning is a delicate topic, with many transactions prohibited, but with the assistance of a progressive lawyer, new opportunities are also provided that may be enforced.