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Are you and your family facing financial difficulties?
Have you been making lavish purchases well beyond what you can afford?
Are you behind on mortgage/rent/car payments to the point of foreclosure/eviction/repossession?
Have creditors or collection agencies been harassing you via phone or letter about unpaid debt?
Are you maxed out on one or more credit cards?
If you answered yes to any of the above questions, you may be on the brink of a financial crisis. Filing for bankruptcy may be the answer to your problems. Bankruptcy was designed to help Americans free themselves from the grips of debt.
If you’re struggling with debt and being harassed by creditors, a consultation with one of our experienced Larimer County bankruptcy attorneys could be your first step toward a financial fresh start. We understand that filing for bankruptcy is a hard choice, especially when so many bankruptcy attorney websites these days throw around unfamiliar terms like “automatic stay” “exemption” and “means test.” To that end, we have designed this website to better help prospective clients understand the Federal bankruptcy process.
If you have more questions or concerns, please do not hesitate to contact our Colorado bankruptcy attorneys. We offer a no-cost case consultation and can answer any questions you may have.
There are a lot of concerns and questions associated with bankruptcy. Our experienced Colorado bankruptcy lawyers have consolidated a lot of the most common bankruptcy questions below. However, it’s important to remember that even a common bankruptcy question can have different answers depending upon the facts and circumstances unique to each bankruptcy case. It is important to note these answers to common bankruptcy questions are just a starting point; for legal advice about your specific case, please contact our experienced Larimer County bankruptcy attorneys.
While Chapter 7 and Chapter 13 both offer debt-relief options, both the execution and who can file for each are very different. Your unique financial standing will determine which one you can pursue, and an experienced Colorado bankruptcy attorney will help you figure out which is right for you.
Chapter 7, also known as straight bankruptcy or liquidation bankruptcy, is the most common form of bankruptcy filed by Colorado residents. Under Chapter 7, a court-appointed trustee collects the property of the individual filing for bankruptcy (known as the “debtor”) and liquidates any non-exempt property.
The proceeds of this liquidation will then be collected by the trustee and distributed to creditors to satisfy any claims they may have. From start to finish, this process takes between 4-6 months, however, you must be able to pass a means test to qualify.
Chapter 13 bankruptcy, also known as a reorganization bankruptcy or a wage-earners plan, is best described as a financial reorganization of the individual’s debts, allowing the debtor to repay creditors over an extended period of time (usually between 3 to 5 years) in accordance with a Chapter 13 plan. Upon the successful completion of this plan, many unsecured and secured debts accounted for under the plan will be discharged.
Bankruptcy is a great solution for many people, but you first have to determine if you qualify and if so, under which chapter. In 2005, Congress passed a new law that is referred to as the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA). It makes it harder to file for bankruptcy, especially Chapter 7. Today in order to file for bankruptcy you need to take a means test that will determine your assets and income versus your ability to pay your debts. Thus, to be able to file for bankruptcy you must meet all of the conditions, including passing the means test as well as getting credit counseling. We would advise you to seek the counsel of a bankruptcy attorney who has handled hundreds of cases to determine if you qualify for bankruptcy.
The means test will determine all of your income. This test will be able to help you determine if you qualify for Chapter 7 or 13 Bankruptcy by adding up the average of all of your income over the past six months through paperwork you or your lawyer have submitted. If your income is below the average Colorado income for a family of your size, you will be eligible to file for Chapter 7 bankruptcy. If your income is too great to file for Chapter 7 then you can often, after discussing with your lawyer, be able to file for Chapter 13 Bankruptcy. You must discuss all of your options with your bankruptcy attorney. They will be able to better help you understand what you qualify for and then advise you if you should file for Chapter 7 or 13 bankruptcy.
As stated above, one of the new laws enacted by the 2005 BAPCPA amendment is that anyone wishing to file bankruptcy in the United States must complete two classes before your debt can be discharged via Chapter 7 or Chapter 13 bankruptcy. You can find state-approved credit counseling agencies through the Department of Justice’s Bankruptcy site, or your Larimer County bankruptcy attorney can help you find a credit counselor.
Although bankruptcy is processed on a federal level, the government allows each state to draft a list of bankruptcy exemptions. Colorado has what’s called the Homestead Exemption that allows you to protect up to $75,000 of the equity in your home or mobile home. This amount increases to $105,000 for homeowners who are 60 or older, who have a disability, or who have a dependent or spouse with a disability.
The second way to pass the means test, if your family makes over the median family income in Colorado, involves deducting allowed monthly expenses from your current monthly income to arrive at your monthly “disposable income.” The higher your disposable income, the more likely Chapter 7 bankruptcy won’t be an option.
Simply put, an exemption is a law that protects your property when you file for bankruptcy. Basically, bankruptcy exemptions level the playing field so that getting a fresh start doesn’t require you to start from scratch. While there is a list of federal exemptions in the Federal Bankruptcy Code, Colorado does not allow filers to use this list, as the state has provided its own (more generous) list of exemptions. Some examples of Colorado state bankruptcy exemptions include:
The primary difference between unsecured and secure debt is the presence or absence of collateral. Unsecured debt has no collateral backing and can include
Secured debt uses some form of property as collateral for the loan. Some examples of secure debt are
Which bankruptcy filing covers which kinds of debts are conversations for you to explore with an experienced Colorado bankruptcy attorney.
There was a time when the lending and borrowing of money was cut and dry; when a person signed up for a loan, the terms and conditions were explained so the borrower knew exactly what to expect. These days, many people are falling for predatory lending practices, which can kick off a spiral that will lead the borrower straight to a financial crisis. If you’ve fallen victim to a predatory payday loan, also known as a check advance loan, deferred deposit loan, quick cash loan, or payday advance, bankruptcy will most likely be able to provide relief.
While Chapter 7 bankruptcy will discharge all unsecured debt (with few exceptions), Chapter 13 does require the debtor to pay back their debts over a period of time. The good news for Chapter 13 filers is that the majority of your debt repayments will go to paying off your priority debts such as mortgages, auto loans, medical bills, and taxes. After these are satisfied any remaining funds are put towards unsecured debt payments, such as payday loans and credit card debt. Regardless of whether you end up filing Chapter 7 or Chapter 13 bankruptcy in Colorado, once your bankruptcy has been finalized, you no longer owe the payday loan organization any money.
If a creditor obtains a judgment against you, they can garnish your wages to repay the debt. Some of the most common types of creditors who garnish wages to pay debts are credit card companies and hospitals. Other types of creditors, including federal, state, or municipal taxing authorities, federal student loan servicers, and creditors for domestic support obligations such as child support or alimony don’t require a court judgment for garnishing, as there are different limits and rules for these types of creditors.
Once you file for bankruptcy, all wage garnishment is ceased, under what is called an automatic stay.
If you’re tired of hearing your phone ring off the hook from debt collectors and credit companies, an automatic stay has the power to change your life. As soon as you file for bankruptcy in Colorado, the automatic stay injunction immediately triggers, which prevents collectors from contacting you about your debts as well as temporarily halting some debt collection processes such as
No.
If the credit card company can prove that you used your credit cards fraudulently, the court can order the debt not discharged, and you will have to pay it back. Additionally, as the credit card company has lent you money based on your promise to repay it, and you had no intention of repaying it, you may also incur criminal fraud charges on top of having to repay all of the debt. Suffice it to say, it’s better to go ahead and cut up those credit cards A.S.A.P.
If you’ve had debt collectors calling and harassing you, they’ve probably been telling you that bankruptcy will ruin your life. Never trust a debt collector to give you accurate financial advice. Bankruptcy laws were written to help people like you get a fresh, dignified start, which wouldn’t be possible if filing for bankruptcy negatively impacted your life forever.
Chances are good that if you’re considering filing for bankruptcy, your credit score has already taken a dip, or even a dive because you’ve made late payments or missed payments altogether.
Allowing continual negative marks to be recorded on your credit report can be worse for your credit than filing for bankruptcy. Bankruptcy is recorded on your credit report for no more than 10 years and by using credit wisely after filing bankruptcy you can quickly re-establish a good credit score beginning almost immediately after filing.
Additionally, filing for bankruptcy may even cause a rise in your credit score. That is due to large amounts of debt being discharged at once. On average, people restore their credit rankings to good standing within 1 to 3 years.
The short answer is, yes, you can. This is called filing pro se. However, the old adage of “just because you can, doesn’t mean you should” definitely comes into play here. Bankruptcy laws are complex and require a thorough examination of your past finances as well as an understanding of the Federal Bankruptcy Code that most average citizens of Larimer County just don’t have. Consider hiring an experienced and knowledgeable Colorado bankruptcy lawyer to help shoulder the burden. Listed below are just a few ways we can help you if you’re considering declaring bankruptcy:
Established in 1861, and named after General William Larimer, who founded the city of Denver, Larimer County is located along the northern border of Wyoming and is home to more than 350,000 residents.
Interestingly, Larimer County is home to not one, but three ghost towns. Manhattan, Old Roach, and Virginia Dale are popular destinations for visitors and residents alike, however, it’s worth noting that some of what’s left of the towns is now private property and should be explored only with permission.
Suppose you’re not interested in touring abandoned cities. In that case, Larimer County is also home to Fort Collins, which has the distinction of being home to over 20 craft beer breweries, including the 4th largest brewery in the world. What makes Fort Collins so popular for breweries? Many experts believe it’s the purity of water from the Poudre River.
Drinking craft beer is a luxury that those saddled with mounting debt in Larimer County can ill afford. Filing for bankruptcy may seem like a last resort, but that doesn’t mean it isn’t the right choice. When you consult with a bankruptcy attorney, you’re placing your entire financial life in another person’s hands. It’s important to find an experienced, compassionate lawyer you can trust.
Our team of Colorado legal professionals will help you by listening to your concerns, answering your questions, and proposing strategies to resolve your debts. You will speak with one of our experienced attorneys without obligation and without judgment. We will evaluate your circumstances and develop strategies to improve your financial situation. We understand how concerned you are about your future.
To that end, during your case consultation an attorney from our legal team will review your debt relief options so you can make the most informed decision possible about your future. Contact our Larimer County bankruptcy law firm today to get the help you need.