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Consumer Debt: Unemployed I have no idea what to do??? : a New Jersey Bankruptcy Attorney Perspective

May 11, 2020 | Posted In Recent News |

The Highest unemployment filings since records have been kept starting in 1938 was recorded in April in the United States; there were more than 20.5 million additional new filings for unemployment benefits. What does a Consumer do if they find themselves unemployed? FIRST file ASAP for unemployment benefits as almost all States are seeing such an influx of applications that their internal computer servers and just general procedures were never designed to handle so many applications for unemployment benefits in such a short period, that there is the real likelihood that the 1st check to you will take a long time to arrive or be direct deposited, so the earlier to apply the sooner you will get the check. The CARES Act also will allocate another $600.00 per week on top of your State unemployment check; currently this additional $600.00 per week is scheduled to continue to the end of July. Florida has the worst record in the US for processing unemployment applications, and then issuing a check. NJ through not on the bottom of the list, is still averaging much longer than usual wait times from application to 1st check payment.  SECOND make sure the IRS has your bank information to direct deposit the $1,200.00 per person and $500.00 per child stimulus check. BUT WATCH if you have a judgment(s) and the Creditors have already or are about to issues an execution against your bank account, you may lose that stimulus check by a garnishment against that account. NJ does allow an up to $1,000.00 cash “exception” found in NJSA 2A:17-19 which will stop any bank execution, but only on the 1st $1,000.00. Also be wary that Credit Unions have by law the right to seize any and all funds in your savings and checking account with that Credit Union to pay any credit card balance, personal loan, or a car loan held with that bank. If you have judgments against you OR have had a bank garnishment already, you could go onto the IRS website {www.irs.gov  GO TO  “Get my Payment”} and change your bank account to another new bank account with a different bank {very important to do if you have accounts and debts with a Credit Union}, OR delete your past bank account information and wait for a paper check in the mail and then cash that check rather than depositing it. Also though the CARES Act stimulus checks are exempt from seizure for back IRS taxes and student loan arrears, they can be seized for arrears in child support. Many States have signed Orders ceasing all garnishments against the Stimulus funds, however NJ has not to date. The Federal Bankruptcy Code upon a filing of a Bankruptcy Petition will stop the Bank from turning over funds in Consumers Bank accounts once seized by Creditors, however a very short time is available to stop the turnover, so timing is crucial.

Discussing your options with a New Jersey Chapter 7 and Chapter 13 bankruptcy lawyer as we go through and upon exiting this never before seen in history event, will allow Consumers and Small Business Owners to be informed of their choices and options under the Federal Bankruptcy Code. It continues to be the hope of all involved with Creditor /Debtor Rights that the private debt collection companies, mortgage companies, credit card companies, utility providers, Car lending companies, unsecured Loan providers, cell phone carriers, internet / cable providers etc. will offer options to help all Consumers  and Small Business Owners catch up on late payments or restructure payments, however if they do not then all Consumers and Small Business Owners need to know their rights for Debt Relief through Bankruptcy.

Discuss Your Options under Chapter 7 or Chapter 13 with One of Our New Jersey Bankruptcy Attorneys in Confidence

To schedule a free, no-obligation consultation at Helmer, Conley and Kasselman, call us at 609-281-8581 or tell us how we can help online today.

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