Can I Accept a Cash Gift While in Chapter 13?

chapter 13 bankruptcy

Filing for a chapter 13 bankruptcy in New Jersey means you’re taking steps to right your financial situation, which may have gotten off-kilter. Some of your debts will be reduced or eliminated through the bankruptcy process, and your remaining debts will be reorganized in such a way that makes them manageable.

After your chapter 13 case has ended, you and your bankruptcy attorney will agree to a repayment plan that is typically laid out over a 3-5 year period, making your monthly payments much lower. Once you’ve been granted a chapter 13 reorganization, you are generally not permitted to take on any new debts until you’ve successfully paid off your existing debts.

Incurring a new debt after filing for chapter 13 bankruptcy is only allowed if you get specific court permission, and this will be granted in very select circumstances only. So, if you’re contemplating buying a new car or making another relatively large purchase, be aware that court approval is needed first. If you fail to get court approval before taking on more debt during your bankruptcy repayment period, your case can be dismissed.

I need a working car; what are my options while in bankruptcy?

With all of that being said – you’ve found yourself in a pickle. While you’re exceedingly grateful for the opportunity of a chapter 13, you may now discover that your vehicle has “died,” and the best financial choice is to replace it rather than to continue making expensive repairs. This is a valid example of when you could petition the court to be able to take on an auto loan, but BE CAREFUL.

Before doing so, pour through all of your financials with a fine toothed comb. You must be absolutely certain that you will be able to make the new loan payments in addition to your debt repayment plan as laid out in your chapter 13 case.

Another question that many debtors have involves receiving a cash gift after filing for chapter 13. Let’s say that your mother, who knows your family needs a working vehicle so that you can get to work and earn money, wants to help you out by gifting you some or all of the money needed to buy that vehicle.

Can I accept cash gifts while in bankruptcy?

Yes, in short. But, before you accept any money from anyone, you are required to report it to your bankruptcy trustee. Any incoming money, above and beyond your paycheck, whether via gift or other windfall (inheritance, etc), is considered to be additional income in the eyes of the bankruptcy court.

Unless you receive only a very nominal gift (for example, $50 in a birthday card), it is of the utmost importance that you report any and all cash gifts while you are working on paying off a chapter 13 bankruptcy.

If your question has not been answered in full here, please contact your NJ bankruptcy attorney, who is best equipped to answer specific questions about your unique case details.

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Equifax Data Breach 2017: Were You Affected?

equifax breach

Unless you have zero credit history and no report exists on file for you with any of the credit reporting bureaus, you may have been affected by a recent security breach at Equifax.

Up to 150 million people (in the US alone) had their private, personal, identifying information exposed and potentially misused. This breach in security occurred only with Equifax. Neither of the other two credit reporting agencies, Trans Union or Experian, were affected.

What happened during the Equifax breach?

Between the months of May-July 2017, hackers were able to bypass some of the cyber-security that was in place at that time at Equifax. They gained access to millions of pieces of personal information, including:

  • Full names and aliases
  • Dates of birth
  • Social Security numbers
  • Current and past addresses
  • Driver’s license numbers
  • Credit card information

Even if you haven’t noticed any strange charges popping up on any of your credit cards, it’s important that you take action if you haven’t already done so. If any of your identifying information was accessed, the first step to righting the wrong is knowledge.

How can I find out if my information was accessed?

Although the general public opinion of Equifax dropped as soon as news of the security breach hit the airwaves, they deserve kudos for initiating a plan of action for those who may have been affected. They created a program called TrustedID Premier that gives consumers one year of free credit monitoring.

Visit http://www.equifaxsecurity2017.com. There, you’ll be able to read details about the security breach; you’ll also be able to enroll in the credit protection and monitoring program.

With two clicks, you’ll learn if your personal information was accessed, or “potentially impacted.” From there, you should move forward and initiate your enrollment in the credit monitoring program. Again, you’ll be given an easy prompt to “Enroll Now,” after you’ve determined if your information may have been affected.

How can I feel safe with a company that experienced such a substantial breach?

While you do have to give your name, address and part of your social security number in order to verify your identity, you can feel secure as long as you are using a secure computer as well as an encrypted network.

Is there anything else I can do to protect my personal information?

Aside from enrolling in the TrustedID Premier program, you should carefully read through your credit reports in their entirety. Go beyond checking your Equifax report; order a free copy of your credit report from each of the three reporting agencies. You can request all three reports at one convenient site: http://www.annualcreditreport.com.

Other potential steps to protecting your private and sensitive data include:

  • Freezing your credit
  • Placing a fraud alert on your credit 
  • Preventing tax identity theft – A lesser known form of identity theft, tax identity theft, can occur if your social security number was stolen. File your 2017 taxes as soon as possible so that no one else can fraudulently claim your tax refund.
  • Continue to carefully monitor all of your bank accounts and credit cards and be on the lookout for any suspicious charges.

If your personal information was accessed and you discover false information on your credit report or unrecognized charges on a credit card, contact a NJ credit repair attorney immediately to protect your financial reputation from incurring any further damage.

 

Image: “Broken Lock” by Chad Cooper – licensed under CC 2.0

Have You been the Victim of Predatory Lending?

nj real estate attorney

Predatory lending is precisely what it sounds like. While there are many lenders in the US who have all of their scruples, it’s important to know that unscrupulous lenders do exist. If you think you were granted a loan you didn’t truly qualify for, or a loan you can’t possibly make the payments on, you may be a victim of predatory lending.

In general, predatory lenders target groups of people based on their lack of understanding about loans and/or their inability to actually repay the loan. Some groups that are targeted include: the poor, the less educated, the elderly, and those who are in need of immediate cash.

Loans given to those who fall into the above groups benefit the lender and can seriously damage the borrower’s credit score and overall finances. Because of this, it is important that you have a clear understanding of any loan you are signing for. If you don’t understand some or all of the loan language, DO NOT SIGN.

As a potential borrower, you have the power to tell a lender that you’d like to wait to make an informed decision before signing. You should then walk out and go directly to an experienced NJ attorney who regularly works with lenders. This may be a debt negotiation attorney, or one that specializes in real estate transactions.

Your New Jersey real estate attorney will have the experience needed to advise you on the loan you are considering. He will also be able to tell you if you are being taken advantage of by a dishonest lender.

Specifically, mortgage lenders have been found to practice predatory lending in recent years. Unscrupulous lenders may target potential borrowers who currently have substantial equity in their home. This is because mortgage lenders will benefit from a loan backed by a borrower’s real property and even a foreclosure. Naturally, not all mortgage lenders are bad! In fact, most lenders are on the up and up.

However, if you get a bad feeling while you are discussing your loan options with a lender, it’s in your best interest to leave their office before signing anything, and take copies with you. When you meet with your NJ real estate attorney, he will be able to read through the proposed loan contract in order to inform you of your best next move.

Don’t risk getting yourself in over your head on a loan that you ultimately will default on. Know all of the facts about the loan by working with a professional who can guide you toward honest and helpful lenders in New Jersey.

Fear of Filing: What’s Keeping You from Bankruptcy Relief?

Without a doubt, money incites emotion.

What emotion depends on the specifics of your financial situation. Suddenly getting a substantial raise at work gives a feeling of success and relief. Coming into an unexpected windfall of money can evoke a sense of thrill and excitement. Steadily watching the number in your bank account dwindle inevitably leads to anxiety, stress, and panic.

Realizing your debt is higher than you can handle can provoke a fear that feels like you’re drowning. Learning that you have solid options to get out of debt when you thought it was an impossibility should instill a solid sense of comfort. Unfortunately, the thought of filing for bankruptcy comes with its own set of complex and confusing emotions.

Even though you may know and logically understand how the New Jersey bankruptcy process can eradicate a large percentage of your debts, you may hesitate to take the necessary steps to file. You’re not alone. In general, those who know they need to file for bankruptcy but are afraid to do so, are afraid of one (or more) of the following:

Ridicule/social embarrassment

Yes, it is more socially acceptable today to file for bankruptcy, but this fear isn’t unfounded. You may have some naysayers and Negative Nanceys if you file for bankruptcy. While they may tsk tsk behind your back, what’s most important is getting your financial life back on track. What will the naysayers have to cluck about when all of your bills are current and you’re able to rise above your strife? Keep your eye on the prize, and kick any and all negativity to the curb.

Job loss/difficulty finding future employment

In order to assuage this particular fear, it’s always a good idea to discuss a potential bankruptcy with your current employer before filing. An informed boss is much better than one who finds himself “hoodwinked.” As long as your higher-ups and HR department give you the green light, you’ve got nothing to fret about.

As for future employment, as long as you keep your nose to the grindstone and make the most of filing for bankruptcy, chances are good that a potential future employer will look at your overall financial picture rather than zero in on just one incident. Bankruptcy discharge is your opportunity to get a strong foothold where your finances are concerned. By using bankruptcy as a tool, you can get out of (and stay out of) debt, improve your credit score, and completely turn your life around.

Inability to buy a home/fear of losing your current home

It’s true that filing for NJ bankruptcy will lower your credit score temporarily. This does mean that making large purchases that will require a loan are off the table, but only in the short-term! By remaining steadfastly dedicated to cleaning up your financial past, a lender will see that you’ve made a lasting change. In just a year or two, you will be able to make large purchases again.

Losing your home is a huge fear for almost everyone when they think about bankruptcy, although this fear is largely unfounded. Now, if you should decide that your home mortgage is out of your budget – you can decide to go forward with a short sale or foreclosure in order to downsize. However, if you would be able to successfully make your mortgage payments if your other debts were gone or significantly reduced, filing for bankruptcy in New Jersey triggers the automatic stay.

Do you have other fears about filing for bankruptcy that weren’t mentioned here? Call us; talk to us. We can walk you through what you’re afraid of and help you understand the process. We’ll give you real, honest feedback, even if that means bankruptcy isn’t right for you.

We Broke Up but She Refuses to Move Out: NJ Eviction Laws

nj eviction

Renting an apartment, condominium or house is a great option for people who aren’t ready to buy a home yet. If you signed your rental agreement as the only tenant, what happens if you meet someone and get into a serious relationship? Most landlords are with your significant other moving in with you, as long as they are informed ahead of time.

It’s such a fun time – moving in together, setting up house and talking about the future of your relationship. Will you get married? Have kids? Perhaps the two of you even take drives, hunting for your ideal NJ town as you consider growing a family together. What type of house would the two of you buy if you got married? Do you want a yard or a pool? Two-car garage or one?

Many relationships that begin just that way go on to enjoy happy marriages, producing one or several offspring, growing older together and watching children meet milestone after milestone. However, what if your ending isn’t of the happy variety?

Of course, not all relationships work out – even when you’ve gone so far as to move in together. In fact, the act of moving in together can sometimes be the straw that breaks the camel’s back; cohabitating is a great way to find out if you’re really compatible.

So, here you are: sharing your rented space with your significant other, and things go south. It’s beyond a fight – the relationship is over and beyond repair. Ideally, since you are the lessee and your girlfriend or boyfriend moved in with you, they would yield to your rights to the apartment and move out.

Sometimes, especially if you had a seemingly ‘perfect’ romantic relationship, breaking up is hard to do. Let’s be honest: breaking up is always difficult, but certain people may be less willing to let go without a fight, making an already challenging situation seemingly futile.

What can you do if your significant other (S.O.) decides to make breaking up impossible?

Your name is on the lease. Your relationship has ended, but your S.O. refuses to move out. Without physically picking her up and carrying all of her stuff to the curb (we specifically do not recommend this strategy) – how can you get your space back so that you can move on?

The bad news is, your relationship didn’t pan out the way you’d hoped and dreamed it would. The good news is, you’re not going to be stuck living with an ex forever, even if they throw a fit and resist moving out of your place.

Can I take legal action to remove my ex from my home?

You can! Ding! Ding! Ding! The fact that you solely leased the property and your S.O. is not named on the lease means you can file an Ejectment Action. In New Jersey, eviction law states that an Ejectment is appropriate when a (non-tenant) roommate to whom you are not married refuses to leave. Since they have no legal rights to remain living there, an Ejectment Action is the only recourse.

Because of the intense emotions surrounding kicking out an ex or loved one (Ejectment Actions can also be used to remove other friends or family members who refuse to leave), they have a high potential for contention. It is important that you are aware of this so that you remain calm and distance yourself from any action(s) that may prompt your S.O. to file a complaint against you for domestic violence. If this occurs, you may find yourself jointly kicked out of the rental.

Collection Defense vs NJ Bankruptcy

If you have been sued by a collections company or “debt collector,” and the debt truly belongs to you, the most important piece of advice is: Do not ignore the lawsuit.

With that being said, people in your position naturally wonder if they have options. Being sued for a debt that perhaps you thought had been forgiven, or that had reached its statute of limitations, can come as a surprise. Many times we put these things out of our minds because it is easier than focusing on it and worrying about it.

Unfortunately, by putting a large debt that you failed to repay out of your mind, you are now faced with a lawsuit that asks you for the entire lump sum that you owe. This sum may even be larger than you remember due to late fees, attorney fees for the collections agency, and interest.

Is filing for bankruptcy your only option?

While it is impossible to give a blanket answer to this question (as everyone’s case will vary wildly) – the general answer is that no, bankruptcy is not your only option when you are being sued for an unpaid debt.

There are several things your NJ bankruptcy attorney will ask when you meet with him or her. Is this your only significant debt? What is your income? Can you repay this debt if it is broken down into payments?

If you have other debts along with the one in the lawsuit, and your income doesn’t allow you to get ahead on paying them back, it may be that bankruptcy is right for your situation.

Can you negotiate with the debt collector?

On the flip side, if the debt in this lawsuit is literally your only debt (outside of your mortgage and car payment), and your income is steady, you might want to have your bankruptcy/debt resolution attorney negotiate with the collection company.

For example, if your unpaid debt amount is $15,000, you may be able to talk the debt collector down several thousand if you pay in a lump sum. It is also possible to negotiate a payment schedule if you wish to avoid bankruptcy.

Is collection defense an option for you?

Collection defense is only appropriate if the debt in the lawsuit doesn’t belong to you, or if the lawsuit contains errors. So, if you are being sued in error, then collection defense is an option, but the reason many people opt for a different resolution is that collection defense representation can get expensive. Regardless of how much you pay your attorney, you can still end up losing the case, even if the debt collector is in the wrong. This is because NJ law doesn’t require strict proof of signed agreements when it comes to credit cards. Therefore, you may end up owing hefty attorney’s fees and still have to repay the debt in full when all is said and done if you go this route.

The only way to know for sure which direction you should go is to sit down with a NJ bankruptcy lawyer or debt resolution attorney. Often, bankruptcy attorneys also specialize in credit repair and debt resolution strategies other than bankruptcy, so look for an attorney who is well-versed in all areas in which you need assistance.

Bidding on a NJ Foreclosure Property: The Lowdown

NJ foreclosure

Buying a home at a NJ foreclosure sale (or sheriff’s sale, as they are commonly called) can be a fantastic way to score a property at below-market price. While there are some risks and pitfalls to be aware of when bidding at a foreclosure auction, if you’re well-informed, you’ll likely come out of the process happy and (hopefully) successful!

Naturally, the most obvious advantage of purchasing a home via sheriff’s sale is the low price you’re likely to pay. Foreclosure sales are a great way to gain ownership of a rental property or a home you intend to “flip.” Homes that are being auctioned at a New Jersey foreclosure sale have been through the judicial foreclosure process that our state requires, and the lender has been permitted by the court to move forward with selling via auction.

How can I find out about upcoming NJ foreclosure sales?

This is one of the best parts about buying a foreclosed property in New Jersey. Sheriff’s sales are required to be advertised for a minimum of 30 days. You can find listings of upcoming sheriff’s sales in local newspapers for each county. Many jurisdictions also have sheriff’s sale listings online on their county court website.

How does a sheriff’s sale work?

In New Jersey, foreclosure auctions are controlled or led by the sheriff’s department of the property’s county. All local county rules must be followed, however, there are several general rules that are consistent across all counties, according to NJ law.

  1. NJ foreclosure properties up for sale must be sold subject to the first mortgage held on the property. This information can usually be found within the property’s first lien.
  2. Any NJ foreclosure sale will also be subject to any/all local state or federal liens on the property.

Because of the above information, all bidders at NJ sheriff’s sales would be remiss to fail to run a complete title search on the property in question before even considering bidding. Failure to do so could land you with a property that is deeply encumbered by multiple liens, for which you will be 100% responsible.

In New Jersey, foreclosure sales usually start with the lender being given an opportunity to open the bidding. Most lenders will start with a $100 bid. Bidding on the property continues via voice auction between all of the interested parties present at the auction.

The usual course of a NJ sheriff’s sale/auction continues with bidding the price of the property higher and higher until a highest bidder remains. If you are the lucky bidder, you will be required to pay a 20% deposit of your bid price.

Upon conclusion of the bidding, the sale is considered to have ended. However, the end of the sale triggers what is known as the Redemption Period. This is a ten day period during which the original owner (who was foreclosed upon) is allowed to “redeem” the property. This can only be done if the original owner can completely pay off the foreclosure judgement amount, including any additional fees and costs (and potential liens).

At the end of the Redemption Period, if the original homeowner does not choose to redeem the home, you will be given a sheriff’s sale deed. When you receive this deed, it is expected that you will make full payment of the balance of your successful auction bid. You’ll also have to handle any fines that accrued relating to the property, after which you will be able to officially transfer the title from the former owner to yourself!

NJ Foreclosure Sale: What is an Arm’s Length Transaction?

When a piece of real property is scheduled for NJ foreclosure sale (also known as and commonly referred to as the Sheriff’s Sale), an interested buyer, investor or “house hunter” may reach out directly to the homeowner. Even when a homeowner’s property is in foreclosure with the Sheriff’s Sale scheduled, they (the owner) have the legal right to attempt to sell the home.

A home that is in NJ foreclosure is likely to sell at Sheriff’s Sale for substantially less than its real value. This can end with the original homeowner owing the lender the difference between how much they still owed on their mortgage loan and the foreclosure sale price. This is called a deficiency, and although lenders do not always pursue a deficiency judgement from the court, sellers should know that it is always a possibility.

Armed with information about a potential deficiency judgement, a homeowner going through the foreclosure process is smart to attempt to find a buyer before the Sheriff’s Sale date. In fact, should the homeowner find an “arm’s length” buyer prior to the foreclosure sale, it’s good news all around. The lender doesn’t have to move forward with their sale, which saves them time and money, and of course, the original homeowner may very well receive a better offer outside of a Sheriff’s Sale. Lastly, the new buyer can feel good about purchasing a foreclosure property before it is up for public sale, eliminating the competition.

What is an Arm’s Length Transaction?

When a homeowner’s lender moves forward with foreclosure, the homeowner still retains ownership and the ability to sell the property before the Sheriff’s Sale, but there are several stipulations in order to guarantee that a seller in this situation can only sell to a party who is considered an Arm’s Length buyer.

For a transaction like this to be considered fair, New Jersey real estate laws state that both the buyer and the seller must not be in any kind of relationship that is closer than “arm’s length.” The following are examples of relationships that are not arm’s length, and therefore would not be ideal buyers before the Sheriff’s Sale:

  • Family members
  • Close friends
  • Employer/employee
  • Parent company/subsidiary
  • Trust/beneficiary

As long as the homeowner is negotiating with someone who is not acting in the homeowner’s best interest (for example, a parent buying the home below market value only to allow their child, the seller, to keep living there), the end result of a transaction prior to foreclosure sale is typically a good idea.

An Arm’s Length Transaction must involve two parties who are independently acting for their own self-interest. Also, the best and fairest deal that is close to the home’s market value should ultimately be the goal of this type of transaction.

Is it Illegal to Participate in a Non-Arm’s Length Transaction?

While it is not necessarily illegal to sell to a non-arm’s length buyer, when a homeowner is already immersed in the foreclosure process, it is advisable to follow the recommendations of an experienced NJ foreclosure/real estate attorney. Ask your attorney to hook you up with a reputable tax professional as well, because transferring property to a non-arm’s length buyer comes with additional tax implications.

Learn more about your rights during foreclosure!

 

Veitengruber Law: Reviews

We can talk about our experience until we’re blue in the face, but you’ll still want to know what our former clients have to say, right? It’s only natural! Everyone here at Veitengruber Law looks for reviews on professionals we’re considering working with (whether privately or professionally) as well.

Here’s what some of Veitengruber Law’s online reviews say. Names have been abbreviated to initials for client privacy.

“George is that rare species of professional possessing a fierce intelligence and a generous heart. He really does act as a “cornerstone for financial justice” in the lives of his clients. Couple this with impeccable integrity and you have an idea of George’s value to his clients. He is the complete package in legal representation.” – E.A.

“I first hired George to help with some collections for my business. After he handled that with such great results, he reviewed our billing procedures. He made some changes to the invoices which helped to minimize future problems. He is very thorough and [I] highly recommend George. He has reasonable fees and a high level of integrity.” – M.H.

“George is a very experienced collections attorney. He is a cool negotiator and gives me consistently solid advice on our collections issues. Many times, based on his advice, we are able to settle even without having to retain him. When we do retain him he applies the same negotiation skill plus his vast legal experience to get us a positive outcome. I highly recommend him.” – D.G.

“George is someone who performs beyond the level expected of him. He is self-motivated, inquisitive, and goal-oriented. While working for me, he demonstrated a strong work ethic, met tight deadlines and was very resourceful in the manner in which he managed client expectations.” – V.O.

“George has advised me on several business organizing efforts and was also the determining force in collecting a delinquent account for my company within 90 minutes of my retaining him. Yes…90 minutes. Not 90 days. He recouped several thousand dollars. George is my go-to guy!” – K.C.

“George took a bad situation […], and within days had all of the details worked out and problems solved. All during this process he communicated with me, eased my worries and assured me all would be well. He delivered outstanding service and I will most certainly call on George again should the need arise.” – K.D.

“Great mortgage lawyer. Down to earth and to the point.” R.G.

I am an attorney in Arizona, and from time to time I have needed information regarding New Jersey law. I have found Mr. Veitengruber to be very knowledgeable, and still friendly and approachable. I am glad that I will never have to try a case against him.” T.C., Esq.

Want to read more what our clients are saying? Visit our Testimonials page for more reviews.

 

What is a Cloud on a Title Report?

As much as we all love to capture images of the beautiful and interesting “cloudscapes” above us, we know too, that clouds can signal storms. This holds true figuratively as well as literally. A cloud found on a title report during a real estate transaction can be quite disconcerting as well as potentially predictive of an impending problem.

Here at Veitengruber Law, we like to make sure that our clients as well as our blog readers have a clear understanding of as much legal language as possible. We’re the first to admit that almost every area of the law is absolutely bursting with legalese that can make many legal processes mind-boggling. We deal with these terms on a daily (dare we say ‘hourly’?) basis, but we know that you probably do not – so we always try to view legalese through your eyes.

What does it mean if there is a “cloud on title?”

If you are in the process of buying or selling real property (real estate), one crucial step in the process is the title search. This step is typically performed by a real estate attorney or a title company. The earlier in your real estate process the title search is performed, the better, because discovering a clouded title right before closing will put a real damper on your excitement.

When a title search comes back as “clouded,” one of several main reasons is generally the cause:

Issues with probate

These issues usually arise with older homes who have had a multitude of owners. There are a lot more opportunities for error when previous owners have died while still in possession of the home. Locating the necessary death certificates and other documentation can prove to be rather time consuming.

Previous foreclosures

While foreclosure on its own isn’t a sufficient reason to cause a cloud on a title, if there were problems with the foreclosure procedure or the judgement, they may appear as a cloud on a title. In order to clear up foreclosure issues, it may be necessary to resubmit foreclosure documentation or potentially re-open the foreclosure case.

Fraud

Although a rather uncommon reason for a clouded title, it is possible that the deed to the property was at one time recorded fraudulently. While rare, if fraudulent transfer of the deed has occurred, you’re in for a long road to resolving the matter.

Liens

The most common reason a property may have a cloud on its title is because the property has one or more liens attached to it. A lien is a notice indicating that the current owner of the home owes money to one or more creditor. Any outstanding liens must be cleared up before the property’s title will officially be called “clear.”

Paperwork/recording mistakes

Even though we’ve been living in the Technology Age for nearly two decades, it is only very recently that governmental agencies/bureaucracies have made the move to computerized record-keeping. This means that most past transactions of the property in question were likely done solely on paper, which is much more likely to lead to errors. Many recording errors can be relatively easy to fix, but some can prove to be quite challenging.

As you can see, a clouded title can often be rather difficult to fix. As you absolutely cannot move forward on your real estate transaction without a clear title, it is best to work quickly with a New Jersey real estate attorney who has experience with clouded titles. Attempting to fix the problem yourself or hoping it will go away on its own may very well end without the sale or purchase of your dream home.