Chapter 13 is an extraordinary legal tool for protecting you from the aggressive civil law collection methods of your ex-spouse and the local support enforcement agency, allowing you to catch up while under this protection.
Child and Spousal Support (Alimony) Collections
New Jersey state law allows ex-spouses and support enforcement agencies to be extremely aggressive in their methods for collecting support arrearage, especially for child support. This includes filing a lien on your property, including personal property, bank accounts, and any real estate you may own.
Another common enforcement tool is the suspension or revocation of state-issued licenses. This includes just about any license issued by the state, including not just your driver’s license but also professional and occupational licenses for everyone from electricians to physicians. If you fall behind on child support and/or are out of compliance with an existing court-ordered or voluntary repayment schedule, your various state-granted licenses could be suspended.
Chapter 7 Possible Solution
Notwithstanding the above, if you are behind on support payments you may be able to arrange a catch-up program with your support enforcement agency directly. Whether this will be possible greatly varies from one agency to another, and also depends on the circumstances of your case. But especially if you are not far behind, filing a Chapter 7 case to discharge all or most of your other debts, and then quickly catch up on your support arrearage, may make sense. The intent would be to clean up your finances so that you could pay the catch-up payments along with reliably making the regular monthly support payments going forward.
The Power of Chapter 13
But if you are not able to make workable payment arrangements with your support enforcement agency, and fear that it is about to start suspending your license(s) or take other collection action against you, Chapter 13 can be extremely helpful. It stops all of the civil law collection procedures stated above. It gives you three to five years to pay the support current, as long as you rigorously keep up with your ongoing monthly support payments in the meantime. And throughout this time most of the very tough collection tools usually available to your ex-spouse or support agency are put on hold for your benefit.
The Limitation of Chapter 13
Do be aware that bankruptcy does not have power over the criminal courts. Nonpayment of support, especially when egregious, could possibly be considered grounds for “contempt of court” for failure to not comply with the court order establishing the support obligation. This comes with a risk of jail, serious fines, and payment of the state’s attorney’s fees and court costs. So talk with your attorney to find out whether in your circumstances you have any concerns along these lines.
If stopping your ex-spouse’s or support enforcement’s collection actions against you is important to you, and you live in New Jersey, we would like to help you. The attorneys at the Law Office of Andrew B. Finberg can help you determine what a Chapter 7 or Chapter 13 case (as well as Chapter 11 and other options) can do for you and your support arrearage. We offer a free, no-obligation consultation. Please call (856) 988-9055 or use this form to contact your New Jersey bankruptcy attorneys at the Law Office of Andrew B. Finberg, LLC.