From Fort Collins to Durango and everywhere in between, many Coloradans are struggling with debt. Combining these uncertain financial times with the high cost of living in the state, even those who are lucky enough to still have full-time jobs are having difficulty paying their bills, with many people falling further and further behind.
Adding to that is the fact that creditors have become more aggressive in their collection tactics; while once they were content with harassing phone calls and letters, many debt collectors intent on getting repayment have resorted to garnishing wages.
Without a doubt, it’s scary to go through a garnishment because it can cause serious financial hardship when you need to pay your essential bills.
When faced with a difficult financial problem like wage garnishment, you may feel you’re out of options. You need an experienced Colorado wage garnishment attorney to help you understand your debt relief options and build a strategy to improve your financial future.
To that end, we have designed this webpage to give a basic overview of wage garnishment and bankruptcy in Colorado. At our firm, we believe that Colorado residents should understand the garnishment process and some defenses that they have against wage garnishment. Once you’ve had the chance to read through the materials provided, we encourage you to contact our Colorado bankruptcy relief firm to discuss the details of your case during your no-cost case consultation.
Wage garnishment is defined as a legal procedure whereby a portion of an employee’s earnings is withheld by their employer through a court order.
Through wage garnishment, your employer will receive a court order instructing him or her to deduct a portion of your paycheck to settle your outstanding debt, back taxes, or other domestic support obligations, such as alimony or child support.
The court order is called a writ of continuing garnishment, and it can last up to six months. This does not mean, however, that at the end of six months whatever debt you owe magically disappears. Once initiated, wage garnishment will generally continue until stopped by a court order or until the debt is paid in full.
If you’re facing wage garnishment in Colorado, it’s important to learn about your rights and options.
If your wages or accounts are being garnished, you can stop the garnishment and deal with the underlying debts, once and for all, through bankruptcy. For individuals seeking debt relief through bankruptcy, the two most common bankruptcy filings are Chapter 7 and Chapter 13.
An automatic stay is enacted as soon as you file for Chapter 7 or Chapter 13 bankruptcy, which prevents creditors from initiating legal action or pursuing collections against you, such as repossession and wage garnishment. If you are behind on your payments or have already had your wages garnished, you must act quickly to save yourself as much money, time, and worry as possible. The automatic stay will last for as long as your bankruptcy case takes to resolve.
It’s important to note that certain debts cannot be discharged in a Chapter 7 bankruptcy, such as alimony, child support, fraudulent debts, certain taxes, and student loans. If your wages are being garnished for any of the above reasons, the garnishment will continue as soon as your bankruptcy debt has been discharged.
A Chapter 13 plan, also called a wage earner repayment plan, is unlike a Chapter 7 in that this form of bankruptcy requires that a debtor repay some amount to his or her creditors by making a monthly payment over a 36 to 60-month plan. If you can stick to the terms of your repayment agreement, all your remaining dischargeable debt will be released at the end of the plan.
Like Chapter 7, Chapter 13 does not halt all wage garnishment actions. If the garnished debt is federal income tax or student loans, the chances are slim that these debts will be discharged in bankruptcy. It is possible the garnishments will continue when the bankruptcy ends after the automatic stay is lifted. This is true for alimony and child support debt as well. Unless you catch up on the debt during the bankruptcy process or create some repayment plan as part of the bankruptcy, the wages will remain attached to the debt and the garnishments will resume.
To learn more about whether Chapter 7 or Chapter 13 bankruptcy would be able to effectively address your wage garnishment problem, contact an experienced Colorado bankruptcy attorney. Our team of legal professionals can examine your situation and recommend the best way to proceed.
If you have missed a loan payment for a secured asset such as a car, truck, or boat, your creditor may send you a default notice, also commonly referred to as a Notice of a Right to Cure. The right to cure gives a buyer a grace period- 20 days in the state of Colorado- in which to catch up on payments before a repossession takes place.
If you have missed a loan payment for a secured asset such as a car, truck, or boat, your creditor may send you a default notice, also commonly referred to as a Notice of a Right to Cure. The right to cure gives a buyer a grace period- 20 days in the state of Colorado- in which to catch up on payments before a repossession takes place.
If you have missed a loan payment for a secured asset such as a car, truck, or boat, your creditor may send you a default notice, also commonly referred to as a Notice of a Right to Cure. The right to cure gives a buyer a grace period- 20 days in the state of Colorado- in which to catch up on payments before a repossession takes place.
If you have missed a loan payment for a secured asset such as a car, truck, or boat, your creditor may send you a default notice, also commonly referred to as a Notice of a Right to Cure. The right to cure gives a buyer a grace period- 20 days in the state of Colorado- in which to catch up on payments before a repossession takes place.
Yes, it is legal for a state repossession agent to repossess their asset from a public place or private property, as long as they don’t breach the peace to repossess said asset.
Usually, when people hear the word repossession, they automatically think of cars. However, there are many types of secured assets that can be repossessed if payment for the loan has defaulted. These include
The two most common types of personal bankruptcy filed in Colorado are Chapter 7 and Chapter 13. As soon as you file for bankruptcy in Colorado, an automatic stay is put into place, which prevents your creditors from attempting to collect any outstanding debt. Additionally, the stay prevents your lender from selling your repossessed asset without the court’s permission.
If your possessions have already been repossessed then filing for Chapter 7 bankruptcy might help you get your assets back if you file quickly. However, if the lender has sold your assets already, Chapter 7 bankruptcy probably won’t help you get it back. Contacting an experienced Colorado chapter 7 bankruptcy attorney for help as soon as you’re in fear of your car being repossessed helps you have the best chance of keeping your assets.
If you don’t qualify for Chapter 7 bankruptcy, you may consider filing for Chapter 13 bankruptcy. By filing Chapter 13 before your possessions get repossessed, you can force the lender to return your property and pay off the loan through your repayment plan over three to five years.
During bankruptcy, exempt property can’t be sold for the benefit of your unsecured debt. Basically, bankruptcy exemptions level the playing field so that getting a fresh start doesn’t require you to start from scratch.
Some examples of Colorado state bankruptcy exemptions include:
There are two major types of debt: secured and unsecured. Secured debt is effectively anchored by your property: A creditor can seize it/repossess it and then sell it if you default and stop paying on the loan.
Unsecured debts are debts that are not backed up by collateral. Examples of unsecured debts are credit cards, unpaid medical bills, and unpaid utility bills. This means that unsecured debt collectors cannot repossess your assets to collect on your debts.
When faced with financial difficulties, the last thing you need to worry about is having creditors garnish your bank account or paycheck.
Our Colorado debt relief attorneys have the experience and resources needed to guide, support, and represent clients from Aurora to Yuma and everywhere in between in debt relief and wage garnishment-related matters. During your first, free, case consultation, our team of legal professionals is available to discuss your unique situation, answer your questions about what to expect when your wages are garnished, and help you explore all available legal options to stop the wage garnishment, including bankruptcy.
If you are already experiencing financial difficulties, the last thing you need is to have your paycheck or bank account garnished by creditors. If your wages have been garnished and you want to understand your rights, contact our Colorado bankruptcy attorneys today for detailed guidance. We service clients all over Colorado, including:
