Having a rudimentary understanding of what will happen during a Chapter 7 bankruptcy can help eliminate any hesitation or discomfort New Jersey residents may have with the process. Filing for bankruptcy can be unsettling enough, but not knowing how it works can make the process even more intimidating. Therefore, below is a broad outline of the Chapter 7 process.
Filing the petition initiates a New Jersey bankruptcy and activates the automatic stay requiring all collection activities to cease during the bankruptcy. However, much more information is required in order to provide the court and the trustee with a complete overview of the filer's financial situation. Therefore, several "schedules" must be filed with the court, outlining the filer's assets, liabilities and income. The trustee will also need to review tax returns, but they are not filed with the court.