Trenton – The list and limits of personal property that is exempt from seizure in bankruptcy proceedings would be vastly expanded under a bill passed by the Senate.
The bill, S-2423, sponsored by Senator Nellie Pou, would, among other things, protect New Jerseyans filing for bankruptcy by providing them with a homestead exemption of up to $340,000.
“Bankruptcy is almost always a last resort,” said Senator Pou (D-Passaic/Bergen). “Families going through this process are dangerously vulnerable and without strong representation can be left with next to nothing. This bill will help ensure that even after bankruptcy, folks will have the means to rebuild what they have lost and not have to fear homelessness or hunger for their family.”
This bill would also allow people to retain $5000 in a personal bank account – $4000 more than what is allowed under current law. Additionally, it would increase the value of personal property that is exempt from being sold at bankruptcy proceedings from $1,000 to $10,000, makes all household goods exempt from seizure and protects aid distributed by the federal government to support residents through the COVID-19 pandemic from seizure.
“These bankruptcy regulations haven’t been updated for close to 50 years and it’s about time New Jerseyans dealing with 21st Century problems are given 21st Century protections,” Senator Pou said.
A previous version of the bill included provisions that addressed non-bankruptcy debt collections, however, Senator Pou opted to draft new legislation that will address debt collection on its own, which will be introduced in the coming weeks.
The bill would take effect immediately and passed the Senate by a vote of 38-0.