Should I Buy a Home with My Best Friend? NJ Real Estate Lawyer Gives His Opinion

Chapter 13 bankruptcy, otherwise known as a “wage earner’s plan” or “reorganization” bankruptcy, allows you to reorganize your debt into a more realistic repayment plan. You can file for Chapter 13 bankruptcy if you have a regular income and can develop a plan to repay all or part of your debt over a period of three to five years. Unlike Chapter 7 bankruptcy, Chapter 13 bankruptcy allows you to maintain ownership of your assets. Chapter 13 can be a beneficial way to stop collection efforts, including foreclosure or repossession. Once you and the court agree on a repayment plan, you will be expected to make a monthly payment that is manageable with your income. If you can make all your monthly payments on time and in full for the duration of your repayment plan, any remaining debt will be discharged at the end of your repayment term. Chapter 13 repayment plans typically offer smaller monthly payments and better interest rates than the original terms of the debts. This way, you can pay less money overall on your debt. One powerful tool of Chapter 13 bankruptcy is the “cramdown.” The cramdown allows a debtor to reduce the secured balance of specific loans to the fair market value of the collateral. The remaining debt amount above the fair market value is often discharged at the end of your Chapter 13 repayment plan. Veitengruber Law works with NJ residents to get out from under unmanageable debt through bankruptcy. We have helped many folks utilize the cramdown to keep their car, secondary house, and other property. Here, we explore how the Chapter 13 bankruptcy can help you. How does the cramdown work? The basic idea behind the cramdown is to ensure you pay a fair market price for your property. The cramdown adjusts the amount of debt owed to align with the actual value of the secured asset. For example, suppose you owe more on a car than it is actually worth. In that case, the cramdown can allow you to reduce the amount owed on your auto loan to the vehicle’s market value. This amount will be rolled into your Chapter 13 repayment plan. The remaining balance then becomes unsecured debt. Once you have completed all the payments in your repayment plan over three or five years, the remaining unsecured debt can be discharged. The cramdown not only reduces your monthly payments, but it also reduces the amount you will pay overall. Many folks use the cramdown to pay back car loans. For example, let’s say your car loan balance is $20,000. In a fair-market-value analysis, your car is only worth $12,000. Chapter 13 bankruptcy will allow you to cram down your loan to the car’s actual value of $12,000. The remaining balance of $8,000 will be included in the unsecured debt balance, such as credit cards and personal loans. Once you have completed your repayment plan, these unsecured debts are often discharged. This means you will only pay a fraction of the unsecured debt you owe. Meanwhile, because you paid back the actual value of your car, you will own it free and clear at the end of your Chapter 13 bankruptcy. What debts are eligible? Not all debts qualify for a Chapter 13 cramdown. The cramdown applies to specific types of secured debts, but not all secured debts are eligible. Car loans are the most common debts that can be subject to cramdown. However, your vehicle must have been purchased at least 910 days (two and a half years) before filing for bankruptcy. Other personal property purchased with financing, such as furniture or appliances, may be eligible if purchased more than 365 days before filing for bankruptcy. The 910-day rule for car loans and the 1-year rule for other personal property are federally mandated restrictions designed to prevent folks from cramming down recent, expensive purchases. Unsecured debts cannot be crammed down. Can I cram down my mortgage? Investment properties or secondary properties can also qualify for cramdown, but primary residences do not. Many NJ courts will expect debtors to pay off the full debt owed on secured property. While this expectation may be realistic for personal property like appliances or furniture, it can be incredibly challenging to repay the fair market value of an investment property in three or five years. Even a crammed-down mortgage can total tens of thousands of dollars. Attempting to pay back this amount of debt in three or five years typically results in one of two scenarios: At the end of your Chapter 13 repayment plan, you will be left with a balloon payment for the balance of your mortgage. For the average person, this balloon payment would be an unmanageable financial burden, especially coming out of bankruptcy. Bankruptcy courts understand the impracticality of this result. They will not allow you to end up in this situation unless you can prove that you would be able to pay off the balloon payment. Including the mortgage on your investment property would make your monthly bankruptcy payments so high that you would be unlikely to be able to make them. If you are going through bankruptcy, you are likely doing so to lower your monthly payments. Because of these potential issues, most people opt not to cram down their mortgage for investment properties. However, for folks who have the means, a mortgage cramdown has a couple of benefits, including: A lower interest rate: The bankruptcy court will determine your cramdown interest rate once you file for Chapter 13. Typically, the interest rate set by the court will be the prime rate plus a few points. This is usually much lower than the interest rate from the original loan. You can use this to your advantage and avoid paying high-interest rates. This helps lower the total amount you pay for your property. No deficiency: Bankruptcy is the single most powerful tool you have to avoid foreclosure on your property. During foreclosure, your lender will try to sell your property for the amount still owed on your loan. However, if you owe way more than the fair market value of your property, your lender may end up selling the property for less than you owe. In some cases, you may have to pay your lender the difference between what you owe and what the property has sold for. This amount is called the deficiency. If you can cram down your mortgage, you will not be liable for the amount of debt that is no longer secured if the property is foreclosed and sold. The unsecured amount of the loan is typically about equal to the deficiency. This means you will not be responsible for repaying your lender for this debt. You will, however, lose the property in this situation.  Veitengruber Law is an experienced NJ debt relief legal team. Our bankruptcy attorney helps people utilize all the tools available through bankruptcy to avoid foreclosure, halt collection efforts, and minimize further financial issues. If you are considering Chapter 13 bankruptcy, we can help.

United States military servicemen and women go above and beyond for our country. They work hard to keep us safe and to protect the American dream—a considerable part of which is homeownership. About 80% of veterans are homeowners—a significantly higher rate than the 60% of non-veterans who are homeowners. This is primarily due to access to VA loans. Because of their dedicated service and sacrifice, service members and veterans are eligible for U.S. Department of Veterans Affairs (VA) home loan benefits. Backed by the VA, these home loans offer competitive rates and help lenders offer more flexible financing terms. Veitengruber Law has worked with many veterans who have purchased homes in NJ. We know what you can expect when you apply for a VA loan. Here is everything you need to know. What is a VA home loan? A VA loan is a home loan through a participating private lender that is guaranteed by the Department of Veterans Affairs (VA). Service members, including National Guard and reserve members, veterans, and surviving spouses, are all eligible to receive a VA loan. Because the VA backs a portion of, or all of, the home loan, lenders are more willing to offer favorable terms, such as no down payment, lenient credit requirements, and flexible income requirements. VA loans are part of the 1944 GI Bill that grants service members access to many benefits intended to help them transition from military service to civilian life. VA loans make homeownership more accessible for military members and their spouses. Since 1944, the program has been expanded to include veterans of other wars and their spouses, as well as additional benefits. What are the benefits of a VA loan? Some key features of most VA loans include: No down payment: Many eligible individuals can purchase a home with no down payment as long as the final sales price does not exceed the VA’s appraised value. No PMI: Private mortgage insurance is often required for conventional loans if the buyer makes a down payment of less than 20% of the home’s value. With VA loans, PMI is not required. This can result in a lower monthly payment. Capped Closing Costs: The VA limits the closing costs the buyer can be charged to 4% of the home’s reasonable value. The maximum origination fee for lenders is 1%. Waived prepayment fee: Unlike conventional loans, which may charge a prepayment penalty for prepaying your mortgage, VA loans allow you to prepay without penalty. VA Funding Fee: Most veterans and servicemembers must pay a one-time VA funding fee. This fee can be paid at closing or rolled into the loan. Some veterans are exempt from this fee, such as those who receive disability compensation. Who is eligible for a VA home loan? Those who are eligible for a VA loan include: Active Duty: Current service members who have served for a minimum of 90 continuous days of active duty. Veterans: Wartime and peacetime veterans are eligible for VA loans, but with different requirements. Wartime veterans must have served for 90 consecutive days of active duty and obtained an honorable discharge. Peacetime veterans must have served for 181 continuous days of active duty and acquired an honorable discharge. Those who enlisted after September 7, 1980, must have 181 days of continuous active duty to qualify. National Guard and Reserve: These individuals must have completed at least six years of service, or 90 days of active duty (at least 30 days consecutive) under Title 32 orders. Surviving spouses: Surviving spouses are only eligible if they are the unremarried spouse of a service member who died in the line of duty or due to a service-related disability. How do VA home loans work? The process for obtaining a VA home loan has a few more steps than a regular conventional loan, but it is relatively simple. 1. Get Your COE Once you know you are eligible for a VA loan, you can work with your local VA to acquire your Certificate of Eligibility (COE). A COE is a document confirming your eligibility for the VA loan benefit. Your lender can also help you get your COE. 2. Get Pre-Approved Just like with a conventional loan, you will need to get pre-approved. You can compare different VA lenders to find the best financing option for your area and financial situation. You will likely need your driver’s license, Social Security card, DD-214, pay stubs, W-2s, and bank statements. While the credit and income requirements for VA loans are much less stringent, you will still undergo a credit check. 3. VA Appraisal Once you find a home and your offer is accepted, your lender will order an appraisal to determine the home’s value. The home must meet VA minimum property requirements to qualify. 4. Closing Once the home is appraised and is found to meet VA requirements, you have basically met all the criteria to go through with your VA loan. While there will be other requirements and documentation needed that are part of the typical homebuying process, enlisting the support of an experienced real estate agent can help you get through closing and into your new home.  Veitengeruber Law and George Veitengruber, Esq. is an experienced NJ real estate attorney. We work with veterans to help them protect their investment and ensure that all parties comply with VA loan guidelines.

Today, ageing comfortably involves a lot of planning. Most experts agree that individuals should have 10 to 12 times their annual income saved for retirement, which averages $1.25 million. But holistic estate plans go beyond a healthy retirement account. Those looking to create a comprehensive estate plan should integrate long-term care planning into their targets. Many adults eventually need long-term care in their later years. For some, this may mean living in a nursing home or assisted living facility. For others, it may require more extensive in-home care from nursing professionals. Long-term care costs can exceed thousands of dollars a month, depending on the level of service. Planning for this kind of expense in advance can bring a sense of relief, alleviating the stress of making decisions in the moment during medical emergencies. It can also provide a safety net for your loved ones, sparing them the financial burden of paying for expensive long-term care out of pocket. So, how do you successfully create a long-term care plan? First, you need to protect your assets. Often, the high costs of long-term care cannot be managed without assistance from services such as Medicare and Medicaid. However, to gain access to Medicaid, you will need to meet specific requirements. This often involves keeping assets and income below strict pre-set limits. Applications for long-term care under Medicaid include a review of your assets in the five years before filing your application. This consists of a review of asset transfers. If it appears that you have been transferring assets or property in an attempt to qualify for Medicaid, you could face penalties. On the other hand, many aging adults find themselves sacrificing their hard-earned assets in their later years to be eligible for benefits. Even if you can keep your assets now, Medicaid estate recovery efforts could make your assets vulnerable after your death. Your estate plan should address these concerns well in advance of your need for services like Medicare or Medicaid. Creating a trust or naming co-owners of important property can help you protect your assets now and in the future while also allowing you to qualify for Medicaid to cover long-term care costs. You can also explore long-term care insurance to cover expenses not met by Medicaid. It is also critical to define your care preferences in your estate plan. Name a power of attorney, medical care proxy, and list what kind of care, medical interventions, and services you will desire for the future. Proper planning can maximize your options for the future while avoiding financial strain and minimizing family disputes.  Estate planning goes beyond a will. It is also about planning for whatever the future holds for you and your loved ones. Veitengruber Law has been helping clients plan for the future for over fifteen years. We can provide the professional guidance and support you need to prepare for retirement and your golden years. Estate planning gives you the power to shape your future to ensure you can retire in comfort.

It’s no secret: times are tough. Since 2020, the US dollar has experienced an average annual inflation rate increase of 4.5%. Grocery prices are increasing. Since last year, we have seen a 12% increase in ground beef, a 5% increase in chicken, and an 18% increase in orange juice, among other items. The growing cost of our food is just one factor in how inflation is raising the cost of living. As a bankruptcy attorney in Monmouth County, Veitengruber Law has seen an increase in NJ bankruptcies over the last year. Let’s look at how inflation is driving New Jersey bankruptcies: 1. Reduced Purchasing Power As inflation increases, the cost of essentials like groceries, housing, and utilities rises. Wage increases cannot keep up with the rapid acceleration of inflation we have seen since 2020. Folks have less discretionary income, and many households are left with little to no money for savings or debt repayment after their monthly bills are paid. The budget that worked for you five years ago may no longer keep up with the cost of living your typical lifestyle. 2. Higher Interest Rates To combat inflation, lenders and banks raise their interest rates on loans. High interest rates make borrowing money more expensive. At a time of financial uncertainty, banks want to protect their own interest by making it more difficult for the average person to borrow money. This causes interest rates on existing variable-rate debt, such as credit cards and adjustable-rate mortgages, to rise. A sudden increase in your interest rate could make it difficult or impossible to afford your monthly payment. 3. Increased Borrowing Despite the high rates, inflation pushes people to borrow to cover the increased costs of everyday expenses. By depending on credit cards and personal loans to afford groceries, gas, and other essentials, it is easy to find yourself struggling with unmanageable debt. High rates contribute to rapid debt growth. 4. Less Savings If you have savings, inflation can cause you to gradually withdraw funds to cover your essential expenses. Even if you manage not to touch your savings for emergencies, you may find it more difficult to continue putting money aside for savings. If you do not already have a savings account, it may seem impossible to start now. This also means that any emergencies requiring funds beyond your monthly income will likely be paid for by accumulating more debt. 5. Fixed Income Struggles Folks on a fixed income, like retirees, do not see their income increase with the cost of living. They are specifically vulnerable to a sharp decrease in purchasing power. It can become impossible for these folks to afford essentials on their fixed income. While inflation can contribute to the need for bankruptcy, it is typically not the sole cause. Common causes, in addition to inflation, include income reduction or job loss, medical debt, divorce, disability or health issues, among others. If you are struggling to maintain a budget with the rising cost of inflation, you’re not alone. New Jersey’s Veitengruber Law can help you explore bankruptcy and other debt management solutions.

In New Jersey, the attorney review period is often the first time homebuyers consider whether they need a NJ real estate lawyer. Although there is a mandatory three-day attorney review period, New Jersey homebuyers are not required to retain an attorney to purchase a home. IMPORTANT: That doesn’t mean you should ignore the benefits of working with a real estate attorney. Veitengruber Law is an experienced NJ real estate law firm with over a decade and a half of experience helping homebuyers purchase their dream home. Here are five reasons you should hire a real estate lawyer when purchasing a home in New Jersey: 1. Contract Negotiation Once you sign a real estate purchasing agreement, you are bound to the terms of that contract. If your circumstances change or something goes wrong, you are still beholden to the signed agreement you made with the seller. It is critical that the contract you sign is purpose-built to protect your best interests. Standard purchase agreements do not offer the protection of an attorney-reviewed, customized contract that addresses the specific details of your transaction. When an attorney reviews, modifies, or creates your contract, they can tailor the terms to your needs and ensure all legal and financial responsibilities are clearly defined. An attorney can help you add contingencies to safeguard your investment and allow you to get out of a contract if issues arise later in the purchasing process. Attorneys are trained in contract negotiation and can help you work with the other party to reach an agreement. 2. Title Search and Issues A title search is critical to the outcome of any real estate transaction. Ensuring the title of a property is free and clear of any legal or financial entanglements can prevent homebuyers from encountering expensive issues down the line. A title search can identify existing liens or legal disputes that could put your newfound homeownership at risk. A real estate attorney is not only trained to conduct a title search but can also help resolve any issues uncovered during the search. If the problems are complex enough, they can even represent you in court. Their intervention can prevent costly delays and save your real estate transaction from falling apart. 3. Compliance with NJ Real Estate Law Every state has specific real estate laws that buyers need to be aware of. If you are purchasing a home in NJ, a real estate attorney knowledgeable about NJ real estate law can help protect your rights while ensuring compliance with legal requirements. The average homebuyer is not going to know the specifics of real estate law, but your attorney will. Working with a real estate attorney can prevent you from accidentally putting yourself on the wrong side of a lawsuit. Especially if you are facing specific legal issues, such as zoning disputes, historic sites, or easements, a lawyer can help you protect your rights and safeguard your investment from the outset. 4. Closing Management Closing is the last step in any real estate transaction. This is the meeting at which property officially changes hands, and you go from homebuyer to homeowner. At closing, all legal and financial aspects of the sale are finalized. This involves reviewing and signing a lot of paperwork and presenting important documents such as the deed, mortgage contract, title insurance, and settlement statements. A real estate attorney will explain documents and paperwork to you to ensure you understand precisely what you are signing. Your attorney will also coordinate with other parties involved in the closing, like your lender, the title company, and real estate agents. They will also be available to tackle any last-minute legal issues so you can close on time. 5. Managing and Preventing Legal Issues  When you work with an attorney from the beginning of your homebuying journey, you are giving yourself the best legal protection available during a complex financial and legal process. Buying a house is one of the most momentous investments you will ever make in your lifetime. An attorney can help you protect that investment and protect yourself from costly consequences. NJ real estate law is complex, and there are plenty of opportunities for things to go awry. When you work with a real estate attorney from the beginning, you shield yourself from potential legal risks. Attorneys can use their experience to identify and resolve issues before they jeopardize your deal. Veitengruber Law can help you navigate the legal complexities of buying a home while protecting your interests and avoiding financial risk. We can help you make informed purchase decisions with confidence. If you are buying a home in New Jersey, reach out to us to discuss the next steps.

As of October 1st, the US federal government has entered a shutdown. Our elected representatives must vote to approve a budget that outlines how government funds and taxpayer dollars will be spent. If these representatives cannot agree on a budget by the deadline, our government will go into a shutdown. Any federal government operations not deemed "essential" will cease for the duration of the shutdown. Services like Social Security, defense, and veterans' benefits will continue to function, but federal museums and zoos, as well as national parks and monuments, will cease operations. While the impact of this shutdown will hit everyone differently, it could affect those with a mortgage or seeking one. If you are looking to finance a new home, refinance your current mortgage, or make payments on an existing mortgage, here is what you should know about the impact of the government shutdown. New Mortgages Those trying to originate a new mortgage during the government shutdown may experience slight delays, but should ultimately still be able to secure a mortgage. But even a delay can be frustrating during real estate transactions. The longer the shutdown drags out, the longer the delays may be. Still, the Department of Housing and Urban Development (HUD) will continue to process FHA loans, and the Department of Veterans Affairs (VA) will also continue in its capacity as a loan originator. Fannie Mae and Freddie Mac are government-sponsored enterprises, but they operate independently of the government. Operations for both are expected to continue as usual, with some slight delays. However, there are specific instances in which folks seeking a mortgage could face challenges getting approved during the federal government shutdown. Those issues include: 1. Getting Required Documentation Getting documentation from the government that is required for your mortgage loan application could be more difficult during the shutdown. While the IRS operated normally for the first five days of the shutdown, that time has passed, and the IRS is now operating under a contingency plan. This plan prioritizes "essential" work. So, if you need documentation from the IRS for your mortgage application, it may take longer than usual to complete the paperwork, delaying your financing and possibly resulting in a lengthy closing process. The IRS and other government entities have many automated systems that allow you to get some documents, such as tax transcripts. Other documents, like payoff letters, federal tax liens, or documents that require human processing, will typically be delayed. 2. Flood Insurance Depending on where you live, you may be required to obtain flood insurance in order to qualify for a mortgage. NJ is surrounded by water, with about 90% of NJ's border touching water. This means that NJ residents are more likely to live in a flood zone than residents in other landlocked states. Those in NJ who live within Special Flood Hazard Areas—those beginning with the letter A or V as identified by the Federal Emergency Management Agency (FEMA)—will be required to carry flood insurance to have a mortgage. For many, the National Flood Insurance Program (NFIP) is the most affordable and accessible source for flood insurance. During the shutdown, the NFIP will continue to service existing policies, but no new policies will be issued. If you have an existing flood insurance plan through NFIP and you are expecting to close on a refinance, some lenders may accept a copy of your flood insurance declarations page to certify that you have flood insurance. 3. Government Employee Challenges If you or your partner are employed by the federal government and you are currently experiencing a loss of income or have been furloughed, obtaining a mortgage can be tricky. Not only can it be challenging to verify employment and income during the shutdown, but your finances may also be changing as you navigate this difficult financial time. If you are a government employee unprepared to face the loss of income with the shutdown, you may find you need to rely on savings intended for a down payment. If you do not have savings, you may even find yourself taking on debt to make ends meet during the shutdown. As your financial circumstances change, so does your ability to qualify for a mortgage. Some mortgage lenders may not even recognize your employment during the shutdown, even if you are continuing to work without pay. Other lenders will count those affected by the shutdown as maintaining employment for qualification purposes. Government Delays Can Push NJ Closing Timelines Most NJ real estate transactions will close within 30 to 45 days. While delays can occur even in typical circumstances, a government shutdown can create even greater delays for those looking to close on a new property. You could face delays of 2 to 4 weeks, depending on the specific government agencies you need to work with and how far into the shutdown we are when you try to purchase your home. There are, however, things you can do to reduce your risk of delay throughout the government shutdown. NJ home buyers and sellers should take the following steps for a smoother closing process. Add buffer time to your contract: Working with a real estate attorney, you can include an extension clause that specifically cites expected federal delays. This can give you and other parties extra time to meet timeline requirements if you hit roadblocks due to the government shutdown. Determine your loan path early: If you know you are likely to use an FHA, VA, or USDA loan to finance your home purchase, be proactive about working with your lender. Reach out to the entity to see what their contingency plan is for dealing with the shutdown. Ask for their advice on the best path forward and determine whether alternative processes are available. Get flood insurance early: If the property you are buying is in a flood zone, initiate the flood insurance process early to avoid delays in coverage. Submit all documentation early: Do not wait until right before a deadline to reach out to federal entities for documentation. Since delays are expected, gathering your documentation early in the buying or selling process can help you avoid delays due to the shutdown. Communication: Keep in touch with your lender, title company, real estate agent, attorney, and other stakeholders. If you know there will be a delay, inform everyone as soon as possible. Keeping all parties informed and on the same page can help prevent further delays in your closing. Working With an NJ Real Estate Attorney When you work with an NJ real estate attorney like Veitengruber Law, you can avoid hitting roadblocks on the path to closing on your real estate transaction. An attorney can guide you through issues and help you find alternative verification paths during the mortgage approval process. An attorney can help you stay on schedule for closing, so if you encounter any snags due to the shutdown, your closing is more likely to proceed as planned. Real estate transactions are complex financial and legal processes on a typical day. When you add a government shutdown to the mix, it can turn into a stressful and frustrating experience. If you have been experiencing closing delays due to the federal shutdown, Veitengruber Law can help. Reach out to us today to get back on track to closing on your New Jersey home.

The lives of the ultra-wealthy have always piqued the public's curiosity. We are fascinated by their homes, their wardrobes, their careers, and, of course, their life events. And when two big names decide to join their empires? That’s a real headline maker! Taylor Swift and Travis Kelce are two such names that have been hitting headlines with their long-awaited engagement at the end of August. Swift is one of the most successful—and wealthiest—musicians of all time. Recent estimates put her net worth above $2 billion. Travis Kelce is one of the NFL's most recognizable faces and has played with the Kansas City Chiefs through three Super Bowl wins. Alongside his NFL alum brother, Kelce has been building the Kelce brand and growing an entertainment career. So, what happens when two big names decide to join forces? We hope a prenup. As an estate planning lawyer in New Jersey, Veitengruber Law works with individuals and couples at all stages of life to protect their interests within the legal and financial entanglements of marriage. After engagement and before marriage, it is incredibly common and legally advisable for the wealthy to have a prenuptial agreement in place before getting legally married. Marriage is, after all, a legally binding contract that typically entitles each spouse to the other's assets and property. Once the contract is signed, there is no going back. While prenuptial agreements have gotten a bad reputation as indicative of ulterior motives or greed, they are the standard, not the exception, for celebrities and the wealthy. Each individual is bringing a sizeable estate into the marriage and wants to protect their assets, brand, and legacy. So, what does a prenuptial agreement do? A prenuptial agreement, colloquially known as a prenup, establishes a legal distinction between marital and separate property. Marital property becomes subject to distribution in divorce. In contrast, separate property is not vulnerable to distribution after the termination of marriage. Common marital property includes shared bank accounts, jointly purchased property, and much more. Separate property typically includes assets acquired before the marriage. For the super-rich, a prenuptial agreement protects them personally, but it also protects their brand and their business. When significant assets include a multi-million-dollar business, a personal divorce can affect the lives and finances of employees. Beyond the material and the now, a prenup can also help protect the legacies of two individuals, both within and outside their marriage. What makes a good prenuptial agreement? To be legally enforceable, a prenuptial agreement must have three elements: 1. Signed and in Writing A prenuptial agreement is legally binding only if it is put in writing and signed by both parties. As far as prenups go, verbal contracts are not valid. The laws governing marriage and asset sharing are well established. To override these legal defaults, a prenuptial agreement must be in writing and mutually agreed upon. Many attorneys will have each individual sign every page of the prenuptial agreement to ensure each party has read the entire agreement and fully understands what they are agreeing to. 2. Total Financial Disclosure Both parties will need to provide a complete reckoning of their financial situation. This will include all income, assets, earnings, debt, or any other financial liabilities leading up to the signing of the prenuptial agreement. This is meant to offer each individual a clear picture of the other person's financial situation, allowing each party to make an informed decision before entering into marriage and entangling their finances. This can also allow both parties to negotiate the terms of the prenup to better favor their own position. For example, if one party discovers the other party is carrying a large amount of debt, they may seek to include a clause in the prenup stating that they will not be responsible for any premarital debt. Withholding this information during the creation and signing of the prenup can result in the prenup's dissolution. 3. Voluntary Entry Voluntary entry is a legal term that means all parties to a contract or legal agreement enter into the agreement knowingly and willingly without coercion, force, or duress. Someone who is mentally incapacitated is not capable of entering into a prenuptial agreement. The use of bribery or other illegal means of coercion can also invalidate a prenup. It is crucial for all parties involved to decide to sign a prenuptial agreement of their own accord. What can a prenup protect? A prenuptial agreement can be tailored to encompass a wide range of protections for different assets and situations. If you and your spouse-to-be want to retain control over how your assets are divided, a prenup is the best way to ensure you keep those rights—no matter what happens down the road. Here are some of the ways prenups can offer future protection: Protect Children from a Previous Relationship: When you enter into a new marriage with children from a previous relationship, you may want to protect particular property and assets for your children. Couples may consider setting aside specific property for their children to ensure they are cared for and provided for. Otherwise, one spouse could take a significant share of the other's assets in divorce or upon the other's death, leaving less for the children. Predetermine Your Financial Responsibilities: A prenup can detail exactly how you and your future spouse will manage joint accounts, credit cards, household bills, and savings accounts. For the wealthy, this may mean a predetermined spousal allowance. For the everyday person, this may just be a detailed plan for how you will handle debt incurred during marriage. Limit Spousal Support: Many prenups outline what spousal support would look like in the event of divorce. Predetermining spousal support can help a couple make a logical decision now so they can avoid costly legal disputes about details later. While prenups can protect a lot, they cannot make legal provisions for everything. With Nicole Kidman's and Keith Urban's separation and impending divorce, rumors are flying about the conditions of their prenuptial agreement, including an alleged "cocaine clause" precluding both from partaking in drug use. A prenup cannot cover child custody, custody schedules, and child support. "Lifestyle" clauses cannot be enforced either. Many couples try to include a no-cheating clause. However, most courts do not uphold these clauses, as they are considered to conflict with no-fault divorce principles. Similarly, most courts will not enforce requirements relating to appearance, sex, social activities, religious practice, or substance use. -- The truth is that while the ultra-wealthy may have more assets to protect, everyone can benefit from a well-designed estate plan. You don't need to be Taylor Swift and Travis Kelce to work with an estate planning attorney to protect your assets. Marriage, divorce, death, the birth of a child—all these milestones can change your estate planning needs.  If you are planning on acquiring a prenuptial agreement or solidifying an estate plan with your new spouse, Veitengruber Law can help. From the ultra-wealthy and famous to your average Joe, an estate plan can help you protect your assets, look after your loved ones, and solidify your legacy.

As a trusted law firm and bankruptcy attorney in Monmouth County for over a decade, Veitengruber Law works with many folks who are unsure if bankruptcy is the right choice. The reluctance to file for bankruptcy is often two-fold. There is a taboo surrounding bankruptcy that frequently leads individuals to avoid filing until their financial situation is dire beyond repair. Even when bankruptcy is considered, people can hold off on filing because they believe they will lose all their property and assets through the bankruptcy process. This is simply untrue; in fact, both state and federal laws are in place, outlining specific exemptions that allow bankruptcy filers to exempt particular property from the bankruptcy estate.  Exemptions in bankruptcy allow you to keep the essential personal property you need to work and live. The decisions you make about which property to exempt are individual and will vary from person to person, depending on your goals and financial situation. Here is what you need to know about bankruptcy exemptions in New Jersey. Choosing Federal or State Exemptions In New Jersey, you have the choice to use one of two different sets of exemptions: State or Federal. Each offers a unique path to protect your personal property and assets. To make an informed choice, you must understand the differences between these exemption statutes. NJ Bankruptcy Exemptions: New Jersey’s exemptions generally do not protect as much property as federal exemptions. Still, depending on your specific goals, it may be the right option for you. NJ bankruptcy exemptions include: Personal Property Exemptions: this includes clothing, burial plot, stocks and interest in corporations, $1,000.00 for furniture and household goods Public Benefits: workers’ compensation, unemployment compensation, Social Security, veterans’ benefits, disability assistance, and crime victims’ compensation Pensions for Public Employees Federal Bankruptcy Exemptions: Federal exemptions offer much more protection for NJ residents who file for bankruptcy. These include: Homestead Exemption: $27,900 for individuals, $55,800 for spouses who co-own property Motor Vehicle Exemption: up to $4,450 Tools of the Trade Exemption: up to $2,800 in tools and equipment required for work Wildcard Exemption: $1,475 to be used however the filer desires OR up to $13,950 if the homestead exemption is unused Personal Property: $700 per item, $14,875 total for animals, crops, clothing, appliances, furnishings, books, household goods, and musical instruments; jewelry up to $1,875 Public Benefits and Retirement Accounts: personal injury recoveries up to $27,900, wrongful death recoveries, alimony or child support, tax-exempt retirement accounts, IRA/Roth IRA accounts up to $1,512,350 Because federal exemptions typically allow individuals to protect more of their property, most opt to utilize them. However, you should not automatically opt for either state or federal exemptions without first discussing your options with an attorney. Bankruptcy is never a one-size-fits-all solution for everyone. Different individuals will benefit from different options within the bankruptcy process. Working with an experienced NJ bankruptcy attorney will help you to make informed choices and protect your assets. Who is Eligible for State Bankruptcy Exemptions? There are specific rules in place regarding who is eligible for specific state exemptions. Some states offer better opportunities for exemptions than others. Because of this, it may be tempting to relocate to a state with more favorable bankruptcy exemptions; however, some rules prevent this kind of strategic moving. To determine if you are eligible for certain exemptions from a specific state, the rules are: IF you have lived in your current state for at least two years, you are allowed to use that state’s exemptions. IF you have moved within the last two years, you are eligible for the exemptions from the state in which you lived the longest during the 180 days immediately before the two years before filing. You might be thinking: WHAT? It can be a bit confusing, so we will look at this through an example. Let’s say you plan to file for bankruptcy in New Jersey on January 1, 2026 . The two-and-a-half-year period you are considering would begin on July 1, 2023. Whatever state you resided in for the majority of the days between July 1, 2023, and December 31, 2023, is the state’s exemptions you are allowed to use. While you will not have to file your case in that state, you can use that state’s exemptions. Property That Cannot Be Exempted in NJ Bankruptcy Depending on the type of bankruptcy you file, you may lose property not covered by an exemption. The bankruptcy trustee can sell any non-exempt property to pay back your creditors. Here are the exemption differences between Chapter 7 and Chapter 13 bankruptcies: Chapter 7: When you file for Chapter 7 bankruptcy, your assets enter into a bankruptcy estate. Assets from this bankruptcy estate can be sold to pay off debts to your creditors. If the property or asset falls under one of the state or federal exemptions, you can protect it from being sold. Chapter 13: If you file for Chapter 13 bankruptcy, you can keep all your property. The bankruptcy court will not take your property to pay back your creditors. Instead, you must pay your creditors back the value of any property not covered by an exemption. This payment will be included in your Chapter 13 repayment plan and will be paid over a period of three or five years. For example: Let’s say you own a car outright. This car is worth $3,000. You decide to use the federal motor vehicle exemption of $4,450. If you decide to file for Chapter 7 bankruptcy, you will be able to keep your car because the exemption protects the equity of the vehicle. If you file for Chapter 13 bankruptcy, you will not have to pay your creditors through your repayment plan, as the full equity of your vehicle is protected. But let’s change the example and say your vehicle is owned outright and worth $15,000. When filing Chapter 7 bankruptcy, the bankruptcy trustee would sell your vehicle, give you $4,450 for the exemption, and distribute the remaining funds from the sale to your creditors. However, if you file Chapter 13, you would need to pay your creditors at least $10,550 through your plan. How Do I Protect Financed Property in NJ? You cannot use bankruptcy to discharge a home mortgage loan or a car loan and keep the property without paying for it. If you still owe a balance on your loan, you must pay as initially agreed upon to prevent foreclosure or repossession of the property. How secured debt is managed under bankruptcy again depends on which chapter you file under: Chapter 7: While Chapter 7 bankruptcy can allow you the time to sort out your payments and get caught up on your mortgage, no mechanism within Chapter 7 allows you to catch up on or cure your past-due payments for secured debts. Your mortgage or car payment must be up to date to maintain the property. Otherwise, you risk losing it. Chapter 13: You will not lose property under Chapter 13 bankruptcy. However, the judge will only approve your repayment plan if you can prove you make enough money to continue making monthly payments AND repay any late payments by the end of your three- or five-year plan. Bankruptcy exemptions can be complex and confusing. Exemption laws are also constantly changing, so it is crucial to the success of your bankruptcy that you work with an experienced attorney. Veitengruber Law has been assisting individuals in filing for bankruptcy in Monmouth County for over a decade. We can help you make informed choices to get your finances back on track.

Many people believe that after they create a will, their estate planning is complete. And while estate planning involves more than just a will , even your will needs to be updated regularly. Most estate planning attorneys will recommend a periodic review of your plan to ensure that it is up-to-date and still reflects your wishes. A cursory review every two years, with a more in-depth review every five years, is a standard that should account for the life changes that occur over time. However, certain circumstances necessitate a more prompt review of your estate plan. Veitengruber Law is an experienced law firm and will lawyer in Monmouth County, New Jersey. For over a decade, we have worked with individuals, couples, and families in NJ to create effective estate plans. As the circumstances of your life change, your will needs to reflect those changes so that it can continue to legally and financially benefit you and your loved ones. Here are some circumstances that should prompt you to revisit and revise your will: 1. Marriage Marriage holds deeply personal relevance for the couple involved, but it also has a very real legal and financial impact. Marriage is a legal contract between two people that creates mutual, legally binding obligations and responsibilities. In the realm of estate planning, this typically means your spouse will become entitled to your estate in the event of your incapacitation or death. In New Jersey, your spouse is generally entitled to one-third of your estate. Without a will, the remaining assets will be distributed to other relatives based on NJ inheritance laws. When you get married, it is crucial to update or create a will with your new spouse in mind. You will be able to designate exactly how much of your estate should pass to your spouse. Leaving a specific portion of your estate to your spouse in your will can legally override the inheritance proportions set out by NJ. Whether this is your first marriage or a later-in-life marriage, updating your will to reflect your wishes for your spouse can ensure they are protected in the future. 2. Divorce Just like it is crucial to update your will following marriage promptly, it is equally important to update your will following a divorce. In marriage, you likely had your spouse listed in a position of prominence in your will and general estate plan. In divorce, your wishes for your ex-spouse may have changed. If your former spouse is recorded as a beneficiary, an agent in a power of attorney, or as the executor of your will, you will want to make quick changes to your will post-divorce. Doing this in a punctual manner can prevent your ex-spouse from having any control over or access to your estate if you become incapacitated or pass away. 3. Death The death of a family member or loved one can also require changes to your will. If a beneficiary or executor passes away, you need to account for how that loss impacts the future of your assets. For example, suppose your spouse was listed as your executor and the sole beneficiary of your estate. If s/he precedes you in death, you will need to designate a new inheritor for your assets. This is also true for the death of other beneficiaries or essential actors in your estate plan. The unexpected death of a loved one can drastically change your plans for the future and should prompt the updating of your will. 4. Having Children As soon as you have a baby, adopt a child, or become the legal guardian of a child, you need to update your estate plan. It is especially critical to account for minor children in your will. Not only will you be considering the financial security of your minor dependents, but you will also be considering who should care for them if you are disabled, incapacitated, or pass away. Without explicit instructions in your will, these decisions will be left up to the state. Pre-selecting a guardian that you trust for your minor children can give you peace of mind that no matter what happens, your kids will be cared for. If you have children with multiple spouses, have adopted children from your spouse’s previous relationship, or have other less straightforward connections with dependents, it is vital to work with an experienced attorney. New Jersey estate law does not cover the detailed complexities of our lives, but your will can when you work with a skilled lawyer. 5. Moving to a New State If you move into or out of New Jersey, you will need to update your estate plan. When you draft a will in any US state, it is created under the laws of that state. New Jersey will have different estate planning laws than other states. Any state-specific aspects of your will should be addressed if you move to a new state, especially when it comes to estate taxes. Moving to a new state can also change your designations for executor, power of attorney, or medical proxy, since previously listed individuals may no longer live in proximity to you. 6. Disability If you or a loved one receives a diagnosis of a long-term disability, it may require you to update your will. Creating a will with a disability in mind can look quite different from making a will when everyone involved is reasonably healthy. For yourself, receiving a difficult diagnosis or becoming disabled may change the way you look at the future. You should nominate a power of attorney and a medical proxy that you trust to follow your wishes. Your wishes for medical intervention or end-of-life care may change over time. Considering these things immediately after a diagnosis can help you and your loved ones prepare for any future challenges that may arise.  Alternatively, if your spouse or beneficiary receives a diagnosis of disability, it may change the way you think about the distribution of your assets. Suppose your spouse gets an Alzheimer’s diagnosis, for example. In that case, it is advisable to remove them from the position as executor of your will since they will likely be unable to carry out those responsibilities in the future. If a beneficiary is or becomes disabled, you can adjust your will to account for their needs. There are numerous financial implications when working with beneficiaries who are eligible for or receive government assistance due to their disability. Inheritance can complicate access to Medicaid and other assistance programs. Working with a knowledgeable NJ attorney to establish a trust for these individuals can ensure they are financially provided for from your estate while allowing them to maintain access to assistance programs and benefits. Estate planning can be a daunting and intimidating process. No one likes to think about what should happen in worst-case scenarios. However, working with an experienced estate planning attorney, like Veitengruber Law, ensures a smooth experience. We do our job with compassion, expertise, and over a decade of practiced knowledge of New Jersey estate law. Reach out to us before you make any changes to your will. We can help you make the right choices to prepare for your future.