Am I Legally Responsible for My Late Husband’s Debts?

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Grieving the loss of a spouse is one of the most stressful periods of anyone’s life, because unfortunately the surviving widow(er) often has much more to deal with than simply grief. Spousal death can leave anyone literally reeling.

In addition to the sadness you are feeling, there are many details to arrange including arranging a funeral, viewing, or other remembrance ceremony for your beloved. On top of the minutiae of planning the commemoration, there are usually other circumstantial issues plaguing your every waking thought regarding your children and/or money. This is especially true if you were not the spouse who was “in charge of” or largely responsible for your family’s finances.

Some of the most common questions running through your mind may include:

  • How will I pay for the funeral?
  • Will I be able to pay all of the bills without my spouse’s help?
  • Is there a life insurance policy to assist me? If so, how do I access it?
  • Has my spouse written a will (Estate Plan)?

As you attempt to find answers to these questions, you may realize that you have additional questions once you start sorting through some of the necessary paperwork.

Sometimes, you may even uncover some information that is quite a surprise, like money problems you were in the dark about – perhaps loans that were taken out without your knowledge.

Chances are good, that, as a married couple, most of your finances were merged long ago. However, if you discover that your late husband or wife had personally signed for loans or had taken on other debt without your knowledge, are you now responsible for those debts?

This is actually a situation that arises more often than you might expect. The answer to this question depends on the type of debt that was incurred, and whether or not your signature is on any of the paperwork. Even if you say you were completely unaware of a particular loan, proving that your late spouse forged your signature isn’t an easy task (but not impossible, if it really is the case).

If your late husband or wife personally signed for a home equity loan or other loans wherein your house was used as collateral, you will not be held responsible for paying the lenders. However, the debts will remain attached to the property, so if you wish to continue living there, you will need to address the debts whether you previously knew about them or not.

Filing for bankruptcy after the death of a spouse happens quite often, but in the event that you want to keep the home that you’re living in, a bankruptcy will not discharge the loan(s) taken out by your late spouse unless you plan to enter into foreclosure.

If you have more questions about what to do after the death of your spouse in the State of NJ, call or contact our office today so that we can sit down with you in a free consultation and start sorting out your financial future.

Image Credit: Beverly

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Can I Sue My NJ Landlord?

2468996425_fd077296dc_zDisputes between NJ landlords and their tenants are quite common. If your interactions with your landlord have disintegrated, you may be considering moving out or you may have already been evicted. If you feel that either of those outcomes resulted in your landlord wrongfully keeping all or part of your security deposit, you may have a case against him.

It is an unfortunate truth that there are some unscrupulous landlords in New Jersey and elsewhere. Some areas are more well known for landlord corruption than others. If you happen to live in one of those areas, it’s possible that your landlord thinks of your security deposit as part of their “piggy bank”, and that he never intended to return it to you from day one of your relationship with him.

If this seems to be the case, be sure to document all of your interactions with your landlord. If you have already moved out of your NJ rental and your landlord refuses to give you back your security deposit, he may tell you that he had to use your security deposit for repairs. He may even ask you for additional money! If this is the case, be sure to demand receipts for all purchases that your landlord makes in order to perform these so-called “repairs.”

If your landlord does provide you with receipts from contractors who performed “repairs” and/or purchase order receipts for materials (Home Depot, etc.), but you feel that you are not responsible (according to your rental agreement) for the repairs that he is making, your next step is to send him a written notice under the Security Deposit Act. In this notice, you will advise him that you are disputing his billing and/or receipts for the repairs that he is performing on your rental unit. Give your landlord 30 days to respond to the written notice. Many times, landlords will end the charade and give you back your security deposit to avoid going to court.

On the other hand, if your NJ landlord cannot produce receipts and bills in accordance with what he has told you, and he does not make any effort to return the money you are owed, you definitely have a case against him and can sue him for your security deposit.

But how do I sue a landlord?

In New Jersey, landlords have 30 days after you move out to return your security deposit, along with an itemized list of any monies that were withheld. This is only different in the case of flooding, fire, condemnation or eviction, in which cases landlords have only five days to itemize and return your deposit to you. (Nolo.com)

After this time period has passed, and you have either not received your security deposit, or have only received part of it, be aware that in New Jersey, landlords can use security deposits to cover the following costs:

  1. Unpaid rent, utility bills or other financial obligations as per the rental agreement
  2. Damages that were caused by you that go above and beyond ordinary wear and tear
  3. Bringing the rental unit up to the level of cleanliness that existed when you moved in
  4. Fixing any changes that you made to the rental (for example: removing curtain rods that you had installed or other hardware that you left behind)

To ensure that your landlord will not falsify his final inspection, you may wish to ask to attend the inspection. At the very least, make sure you have many good quality photographs or video that gives clear proof of the condition of the rental unit on the day that you move out.

After the appropriate waiting period, if your landlord still refuses to return your deposit or has taken money that you feel is unjustified, the next step is to announce your intentions to your landlord about going to court.

As long as the amount you are owed from your security deposit is less than $5000, you can sue your landlord in Small Claims Court. The fee to sue your landlord is only $50. You can find details about small claims cases, like forms, fees, and whether or not you need an attorney at the NJ state court website.

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Home Ownership & Student Loan Debt: How They’re Connected

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Applying for a mortgage loan is akin to putting all of your financial cards on the table. Because the amount being borrowed is so high (in most cases), lenders will scrutinize all of your money decisions with a fine tooth comb. With that being said, it is best to wait to apply for a mortgage loan until such a time when your other financial obligations are low and your credit score is good.

However, everyone knows that life doesn’t always go as planned, and many millions of Americans are finding themselves paying off student loan debt years, sometimes decades after they have finished college. Many of these people may have in fact defaulted on their student loans, which can result in a legal judgment from the court.

Understandably, lenders are very wary of giving a loan to someone who has already defaulted on a loan in the past. They’d rather not take the risk of losing big-time money, and may pass you over for the next borrower ‘standing in line.’

So, what is a person to do if they are working hard to make good on an old student loan judgment? Must they wait until their loan is 100% paid off to pursue their dream of owning a home?

The real answer to this question is “maybe.” While that answer may not seem very encouraging, it’s better than an outright “no.” Lenders are going to look at more than just an outstanding student loan judgment (even if you are currently making steady payments on that loan via wage garnishment).

Another big factor that mortgage lenders are going to take into account is your overall credit score and your credit report. If you haven’t taken a look at your credit report recently, take advantage of the free report available to you at annualcreditreport.com. If you want to know your actual score, you will simply have to pay an extra $10.

If your score is at least fair, (above 630), that is proof that your student loan has not put a permanent albatross on your credit score, and moving ahead with applying for a mortgage loan is definitely within the scope of reasonable actions for you at this time.

If, on the other hand, your credit score is less than 630, you probably won’t get approved for a mortgage loan immediately, but you do have several options to help yourself move toward that goal.

First, make contact with your student loan lender(s). By reaching out to them personally, you’ll likely have a better chance of getting out of student loan debt much faster than you will on your current payment schedule. Many lenders have a rehabilitation program that helps debtors get back on track. If your lender is not amenable to speaking with you or negotiating with you, contact a New Jersey attorney who has experience dealing with both student loan debt and real estate. The right NJ attorney can negotiate your outstanding debts down to a much more manageable level – so much so that the fees associated with hiring an attorney will seem like a drop in the bucket.

Another thing you can do is apply for three secured credit cards and begin using them as soon as you receive them in the mail. Pay off the balances consistently every month for the next six months. This action alone will boost your credit score and help put you in position to get that mortgage loan, and get into the home of your dreams.

To get additional information and help negotiating your student loan debt, contact our office now for a free consultation. (732) 852-7295

Image credit: Chie

If I File for NJ Bankruptcy, Will I Lose My Car?

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Just the idea of filing for bankruptcy in NJ can be truly exhausting and stressful. Add in all the questions that come up along the way, and you have a recipe for massive confusion. Luckily, you have already acknowledged that bankruptcy may be a good way for you to get your financial life back in order. That is the first step toward making better decisions that will turn your situation around.

Many people avoid filing for bankruptcy for far too long because of fears, misinformation or misunderstandings about what actually happens when bankruptcy is filed. The best way to make sure you have accurate information about your NJ bankruptcy petition is to work closely with an experienced bankruptcy attorney.

Your NJ bankruptcy attorney will be able to look at your unique financial details and explain to you exactly what may or may not happen should you decide to file for bankruptcy.

Some of the most common questions asked by clients who are contemplating a bankruptcy case include: Will I lose my house? Will I be able to buy a new house? What will happen to my retirement benefits? Will I be able to accept an inheritance? How much of my Social Security check will go to paying off my debts?

Today, we will try to answer the question pretty much everyone wants to know:

Will I lose my car?

Understandably, fear of losing your mode of transportation is quite high for those people who are already struggling to make ends meet. The lack of a proper vehicle may inhibit them from getting to their job every day, which may be the only thing keeping them afloat at this point.

The good news is, that if you own your car outright, you will be able to continue driving to and from work without a problem, as long as it does not have a value above your state’s vehicle exemption amount.

If you are still making payments on your vehicle, it becomes a little bit more confusing. While you are negotiating the terms of your bankruptcy with the help of your NJ attorney, one thing you will have to decide is whether or not you want to keep making payments on your car, or if you want to surrender it.

That’s right, it’s up to you. However, if your vehicle monthly payment is quite high, it would probably be most beneficial to surrender your car in the bankruptcy. In this case, you will not owe any further liability on your vehicle loan after your bankruptcy case is completed, and you can attempt to buy a much less expensive car that falls within your new budget.

If you would like to continue making payments on your vehicle after you file for bankruptcy, you have several options. Sometimes, lenders may simply continue to accept your monthly payment without a reaffirmation agreement (making up a new contract). Some lenders will require that you enter into a new contract with similar terms, stating that you agree to be responsible for the debt even after your bankruptcy case ends.

If at all possible, it is best to keep making your car payment without a reaffirmation agreement because if you do end up defaulting on your payments, you won’t owe any deficiency amount, because it will have been removed from your responsibility in your bankruptcy case.

If you do agree to reaffirm your car loan, your lender can repossess your vehicle if you default on payments, and you will be responsible for any deficiency, since you agreed in writing to be responsible for the debt after your bankruptcy case.

 

Image credit: Michael Evans

 

Retirement and Student Loan Debt: How They’re Connected

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To most of us, the word retirement brings to mind images of a renewed enjoyment of life – a time when we will finally be able to put work aside and possibly even find time to stop and smell the roses. Then again, the phrase ‘student loan debt’ isn’t one we usually associate with our golden years.

Unfortunately, these days, more and more older Americans are entering the retirement age bracket, but are unable to look forward to retiring with joy. Sadly, many older Americans are still affected by student loans they took out in their younger years, but were simply unable (for a variety of reasons) to pay off.

In fact, there are approximately two million Americans aged 60+ who are still struggling under the weight of unpaid school loans. According to the Federal Reserve Bank Of New York, this number has tripled since 2005.

Some older Americans are saddled with student loans that they themselves took out years ago in order to put themselves through college, while others took on the responsibility of cosigning a student loan for a family member (usually children).

Regardless of the reason for student loan debt among older Americans, attempting to repay an amount that is perpetually compounding due to high interest rates is exceedingly difficult for this particular group. Due to the fixed income that comes along with retirement, many retirees are finding it virtually impossible to stay up to date on their student loan debt.

What this means for retired debtors is that they will likely experience wage garnishment from their Social Security income. For an already struggling group, this can spell financial disaster.

Although retired student loan debtors truthfully do only represent a very small portion of all student loan debtors, the seriousness of their particular situation is quite dire.

In fact, wage garnishment being taken out of Social Security payments will likely push these older Americans into poverty. Working hard your entire life, only to spend your golden years without two pennies to rub together just doesn’t sit right with this New Jersey law office.

Can you relate to Carrie Mallik*? Age 62, Carrie is experiencing some declining health and a home loan that she can’t afford. On top of that, she owes over $100,000 on a $15,000 student loan from her youth, due to the astronomical interest rate when she borrowed the money. Unable to afford both her mortgage payment and her student loan debt, she is quickly finding herself in a hopeless situation. If you can relate to Carrie, it’s important that you know that there is hope for you.

Because of new legislation, people who took out student loans prior to July 2013 will now be able to refinance their student loans at significantly lower interest rates.

Finding a NJ attorney like George Veitengruber, who is experienced in and passionate about credit counseling and debt restructuring, is key to your success in this situation.

Veitengruber Law can help you secure your retirement and allow you to enjoy your golden years as planned. Call now (732) 852-7295.

Image credit: The Arches

*Name changed

Child Support and Bankruptcy: What You Need to Know

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Oftentimes after a divorce, there can be some pretty significant financial difficulties that can potentially lead to a NJ bankruptcy filing. Money problems may be encountered by both parties, or perhaps only the spouse who took on most of the financial responsibility during and after the split.

Naturally, if your ex-spouse files for bankruptcy, you’re going to be more than a little worried about the outcome, especially if you are depending on him or her for child support, alimony, or other payments.

Up until 2005, it was possible for those who filed bankruptcy to include money owed to their ex-spouse in their bankruptcy filing. If it was deemed less harmful to the other spouse (the person being “owed” money in the Property Settlement Agreement, or PSA), some courts would discharge PSA debts.

Luckily, in 2005, it was made clear by Congress that all debts considered “priority debts” would absolutely NOT be dischargeable in bankruptcy cases. Child support and other divorce-related debts are considered priority debts. That is great news for you if your ex-spouse owes you money in any fashion – whether through the PSA or child support/alimony payments.

Although your ex can’t get out of child support obligations simply by filing for bankruptcy, it is possible that he or she will simply stop paying some or all of the money. When this happens, it is usually due to an ex-spouse being legitimately out of money due to job loss. However, any non-custodial spouse who is found to be in child support arrears in New Jersey will be sought by court officials regardless of the reason for not paying. Non-payment of child support is cause for a judge to issue an arrest warrant.

Can my bankrupt ex-spouse get out of paying OTHER types of divorce-related debt?

Child support and alimony aside, there are many other financial considerations during any divorce that results in a NJ bankruptcy. Things like homeowner’s association fees, credit card debt, back (or current) taxes, vehicle payments, doctor’s bills, mortgages, and other types of loans that may have been taken out jointly.

If, during your divorce proceedings, it was written into the Property Settlement Agreement that your ex-spouse is responsible for paying off any of the above-mentioned (non-priority debts), he or she WILL be held responsible for these debts even if a bankruptcy case is opened. Your ex-spouse cannot legally discharge any divorce-related debts that he or she has been ordered to pay by a court of law.

Sometimes an ex-spouse, although legally responsible for repaying a certain divorce-related debt (such as a credit card balance), will simply stop making payments regardless of the court order. Although your ex-spouse can’t legally avoid the debt, if your name is on the account, it is possible that the credit card company (or other lender) will come to you looking for the money. That is because they are a third party to your divorce and they didn’t agree to not get paid.

In this situation, or anytime you aren’t receiving money owed to you due to your ex-spouse filing for NJ bankruptcy, it’s important that you contact your family law attorney immediately.

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Evicted in NJ? Know Your Tenant Rights.

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If you are in the process of being evicted, or think that you may be in danger of being evicted from your NJ rental apartment or house, it’s important to know that you have rights as a tenant.

Renting has become an increasingly popular way to obtain residency in recent years as mortgage rates have soared. To landlords, that means there are more people looking for a place to rent. This way of thinking has led some landlords to prematurely evict (or attempt to evict) tenants who are late with the rent several times.

If you fall into the category of a renter with habitual late payments, but have a reason for your payments being late, and have been able to make payments at least once every 3 months, you may have a good case for avoiding eviction.

Let’s face it, no one WANTS to have to go through the trouble of finding a new place to live all over again, filling out applications, white-knuckling the wait period, rounding up friends and family to move unwieldy couches and heavy bedframes, yada yada yada. It’s no fun being evicted in New Jersey, or anywhere, for that matter.

Is Your Financial Trouble Temporary?

If you have lost your job and have absolutely no prospects for future employment and your debts are quickly rising around you, it may not be possible to avoid eviction.

However, the New Jersey court system is typically on the tenant’s side – hoping to give you a chance to get back on track with your rent payments in order to stay in your home. In fact, if you can pay any late rent (default) plus late fees and possible attorney’s fees (if your landlord has filed a complaint) before your court date, the complaint will be dismissed and you will not be evicted at the current time.

It’s notable that, if you are currently receiving FHA help, any late fees and attorney’s fees for the opposing party are disallowed in New Jersey.

If it looks like your financial cards may be falling into order sooner rather than later, it is well worth the fight to avoid the additional costs associated with being evicted in order to stay where you are. A NJ attorney who has experience helping clients with real estate and landlord/tenant issues will be able to easily assess your situation to give you sound advice regarding whether you’d be better off starting over somewhere new (perhaps in a lower rent area), or whether it’s in your best interest to attempt to right your late payments and stay in your current place of residence.

If you need more information on New Jersey eviction law and your rights as a tenant – call or email George Veitengruber today and inquire about a free consultation.

Image credit: Joris Louwes

When Should I Make Changes to my Will?

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We understand just how uncomfortable it can be to give much thought to your own mortality. Sometimes, however, it’s necessary to put your discomfort aside in order to do the right thing, which, in this case, is setting up an Estate Plan.

Otherwise referred to as a “will” or Last Will & Testament, having an Estate Plan in place means that your loved ones will have the guidance they need after your passing in order to make decisions on your behalf. Keeping your Estate Plan updated means that you may be able to keep your dearest family members and friends out of major disagreements that can be extremely harmful during the mourning period.

Assuming that you already have a will in place, many people wonder if and when it is necessary to make changes to their Estate Plan. After all, our world is an ever-changing place, and naturally, so are our lives. What we set into place five years ago may be obsolete today.

Consider making formal changes to your New Jersey Estate Plan if:

  • Your love life blossoms – Whether you get married or enter into a long-term committed relationship, it’s important to add your significant other to your will, because without doing so, your legal partner has a right to half of your property and a partner that is not legally recognized will get nothing. If you object to either of those situations, you need to put it in writing.

 

  • A marriage ends in divorce – Although most states automatically revoke any property rights from a former spouse as soon as a divorce is finalized, some states do not. It’s important to check. Also, it’s entirely possible that you may still want to include your ex-spouse in your will, especially if you have children together. If that’s the case, you may have to “write them back in.” You may also need to make changes if someone named in your will gets divorced – for example if your daughter divorces her husband, you may no longer want him to be named in your will.

 

  • You hear the pitter patter of little feet – Whether you give birth to, adopt, or gain step-children by marriage, you’ll want to ensure they are cared for in the event of your passing. Children are automatically given certain rights to some of your property, so if you want to be specific about who will receive what, be sure to put that in your Estate Plan. Also note that step-children are not automatically entitled to inherit anything from you, but most step-parents do want to include them.

 

  • You have a change of heart – Let’s face it – things happen in life, and that’s putting it mildly. Oftentimes, people change their mind about who they’d like to leave part or all of their property to – due to special or unforeseen circumstances not listed above. The important thing is making sure it’s in writing, because otherwise, you’ll be shaking your fist from beyond.

 

But How Do I Change My Will?

You can make changes to your will by speaking to an attorney who specializes in NJ Estate Planning. He will help you modify your paperwork by adding a codicil or by writing a completely new Estate Plan. A codicil is an amendment or a “PS” to an Estate Plan document that overwrites part of your will or adds new provisions. If you decide to add a codicil, it must be signed and legally witnessed exactly as your original Estate Plan was in order to be legal. Today, it is usually much easier to create a completely new Estate Plan, stating in which that you revoke all past wills and codicils. This helps to avoid any confusion regarding which papers are most current and accurate at the time that they become necessary.

Image credit: Walter

Is My Bankruptcy Trustee Working For Me or Against Me?

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If you are considering filing for bankruptcy, or already have filed, you have probably wondered about the duties of your bankruptcy trustee.

Does he work for me? Is he against me?

In any bankruptcy matter, the trustee is not “on” anybody’s side. He/she does not represent you or your creditors. The trustee is not “out to get you”, or to either prove or disprove your case.

Every bankruptcy case is assigned a trustee to look over and represent the bankruptcy estate that is created when the bankruptcy case is opened. A bankruptcy trustee is assigned by the Department of Justice, and is responsible for collecting all assets of the NJ bankruptcy estate in order to pay off creditors with valid claims that you owe them money.

Your trustee is expected to remain impartial throughout his/her role as your trustee. Some of the responsibilities that come with being a bankruptcy trustee include:

  • Inspecting all of the paperwork involved in your bankruptcy matter, from the original bankruptcy petition to your tax returns, pay stubs, mortgage paperwork, and information about all of your debts and bank statements. This is the trustee’s first priority during any bankruptcy case, and it is performed so that he/she can verify that all of the information included in the original petition as well as all of your financial documents and papers is accurate.

 

  • Holding the Meeting of Creditors, also called the 341 hearing. During this hearing, the trustee will ask you any and all questions that he/she may have regarding information in your financial documents. Any of your creditors are allowed to attend this meeting as well, but more usually they don’t. Creditors may attend the 341 hearing if they feel that you are being less than truthful about your assets, but otherwise, this meeting is usually held between you (along with your NJ bankruptcy attorney) and the bankruptcy trustee. During the 341 hearing, you will be under oath, so it is imperative that you answer all of the questions asked by your trustee in complete honesty.

 

  • Paying your creditors with any of your assets that do not fall under the “exempt” category. This duty is probably the most well-known task that the bankruptcy trustee is responsible for. While you are permitted to retain possession of some of your personal property in a chapter 7 bankruptcy (exemptions), any assets that you own that are above and beyond your exemption amount will be liquidated (sold) by the trustee in order to pay back as many of your creditors as possible.

 

  • Preventing preferential transfers or interests. In a bankruptcy case, your financial behavior during and immediately preceding the filing date will be closely examined. If it is obvious that you transferred any property or paid any money to specific creditors in favor of others, the trustee is permitted to re-collect this property and/or money so that it may be evenly distributed among all of your creditors.

A bankruptcy trustee is not working for you or against you, per se. A good way to look at it is that the trustee will ensure that your bankruptcy petition and paperwork are all flawless, which can only aid in making sure that your debts will be discharged and that your bankruptcy petition will not be dismissed.

Image Credit: Fried Dough (flickr)