Ocean Gate, NJ Bankruptcy Law Firms & Lawyers

The simple answer is yes. Generally you get to keep all of your assets in a Chapter 13 bankruptcy. In order for your Chapter 13 plan to be approved by the court there are two tests that have to be met. You have to pay all of your available income into the plan. That means that you will be placed on a budget and all of your excess income beyond your allowable expenses must be paid on a monthly basis into the plan. You also have to pay into the plan at least as much as you would have had to surrender in a Chapter 7 (liquidation) bankruptcy. Assuming that the savings account was not exempt and that was your only nonexempt asset, you would have to pay at least $20,000 into the plan to satisfy this test. The plan is typically 36 or 60 months depending on your income. So in a 36 month plan the payment would need to be at least $555.55 per month (20,000/36) to satisfy this test. For a 60 month plan the payment would need to be at least $333.33 per month (20,000/60) to satisfy this test.

Yes. You are allowed to sue non-profits for breach of contract. The more practical issue is whether you can COLLECT on the judgment. I recommend calling an attorney and negotiating a settlement.

Based on what you are saying it sounds like the H.O. Association sued you, filed a lis pendens (which means there is a pending lawsuit involving the property), obtained a judgment against you and probably filed an Abstract of Judgment. An Abstract of Judgment creates a lien on all the property you own in the County where it was filed, including the property on which you owe the H.O. fees, for the amount of the judgment. You can file a Chapter 7 case and surrender the property on which you owe the H.O. fees. Your personal liability for H.O.'s judgment and any additional H.O. Association fees before you file the Chapter 7 bankruptcy case would be discharged. Therefore, the judgment would have no value and would be unenforceable since nothing would be owed after you the get the discharge. If an Abtract of Judgment was filed then you might have to file a motion in the bankruptcy case to avoid the lien created by the Abstract of Judgment because the Abstract of Judgment might cause you problems in the future if you ever buy another property although your personal liability for the judgment debt was discharged in your bankruptcy case. You need to discuss with a bankruptcy attorney if it is worth it in your situation to file the motion to avoid the lien created by the Abstract of Judgment. If you remain in possession of the property subject to the H.O. Association fees after filing for bankruptcy and surrendering that property in the bankruptcy petition you might be liable for H.O. fees after the bankruptcy filing date. That is an issue that is not legally clear. I believe that if you surrender the property in the bankruptcy case you would not be liable for post-filing H.O. fees even if you stay in the property but other bankruptcy lawyers may have a different opinion. The courts have decided that issue in different ways. In any case, it very likely that the H.O. Association would be paid in full by the bank before it forecloses since the lien of the H.O. Association for its fees is superior to the lien of the bank for the mortgage. In order for the bank to sell the property at the trustee's sale the amount owed to the H.O. Association lien will have to be paid. A buyer at a trustee's sale would want to obtain title to the property free of the H.O. Association lien. Therefore, generally the bank foreclosing on its mortgage pays all liens superior to its mortgage before the trustee's sale, including the liens for H.O. Association fees and unpaid property taxes. I have seen cases where the H.O. Association has been paid in full by the bank before a foreclosure and then continued to collect on the judgment against the homeowner who does not know that the bank already paid the entire debt. What happens is that the H.O. Association "forgets" to tell the collection company that they got paid in full.