Seymour's Blog

Could This Be the Most Amount of Money Owed by a Client for Motor Vehicle Surcharges?

A very important fact that a lot of clients don’t know is that bankruptcy can wipe out motor vehicle surcharges. Over the years I’ve probably had hundreds of clients who were unable to get their driving privileges restored because they owed motor vehicle surcharges that they couldn’t afford to pay.

Many clients were amazed when I told them that I could help them get their licenses back by totally wiping out their surcharges in either a Chapter 7 or Chapter 13 bankruptcy. The typical client that sees me might owe anywhere from $3,000 to $5,000 in surcharges. Once in a while we get a client who owes something in the vicinity of $10,000 or maybe even $15,000 in surcharges. Irrespective of the amount owed to the New Jersey Motor Vehicle Commission, if a client otherwise qualifies to have his/her license restored, filing a Chapter 7 or Chapter 13 will normally wipe out the surcharge obligation, and the person can get his/her license restored. They will usually have to pay a restoration fee of about $100. If their driving privilege has been suspended for more than 3 years, they will normally have to take and pass the driver’s examination.

I have often wondered what the record is for the highest amount of surcharges owed by one single person to the state of New Jersey. On several occasions I’ve has clients who owed in the vicinity of $30,000 or $40,000 in surcharges. Nevertheless, once their bankruptcy was filed, they were eligible to get their license back, based on the discharge of those surcharges.

I recently met with a client, however, that definitely took the cake when it came to the amount of surcharges owed. I was amazed when he told me that he owed about $74,000 to the Motor Vehicle Commission for surcharges. I figured that with that kind of surcharge balance, judges had probably suspended his license for a number of years, and that he would not be eligible to have his license restored even though we could clearly wipe out all of his surcharges.

For example, if judges suspend your driving privilege for a number of years, and you have a large amount of surcharges, the surcharges will be wiped out when you file bankruptcy, However, bankruptcy will not eliminate the time period you have to wait as a result of the judges having suspended your license. In other words, if you owe $10,000 in surcharges, and the judge suspended your license for 3 years, if you file for bankruptcy 2 years later, you will still have to wait for that remaining 1 year to go by before you can get your license, even though your surcharges have been legally forgiven.
When I discussed this with my client, he said something to the effect that “Yeah, I’ll be an old man, by the time I can get my license.”  He wasn’t really sure for how long the judges had suspended his license, but he certainly figured it was for many years into the future.

Well, since I realize that many clients don’t fully understand the status of their legal situations, I thought we might as well call the Motor Vehicle Commission to see what his record really showed.  We got a very helpful representative from the MVC on the line, and to my amazement, and certainly to my client’s great surprise,  we were told that the only thing that was keeping my client from having his driving privilege restored was the outstanding surcharges. This means that once my client files Chapter 7, pays his restoration fee, and passes the driver’s test, he will be legally back on the road again, and he’ll be able to wipe out $74,000 in surcharges. That certainly put a smile on his face.

The moral of this story is that no matter how much you owe to the Motor Vehicle Commission for surcharges, you can normally wipe those out by filing a Chapter 7 or a Chapter 13, and if there is there no other reason keeping you from getting your license, you could be legally back on the road in a short period of time.

We’ve help hundreds of clients get their driving privilege restored in these types of situations, so if you have this type of challenge with surcharges feel free to call us with any questions. Best wishes.