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Mountains of debt can leave you feeling helpless. Maybe you have overwhelming credit card bills or maybe you just can’t seem to be able to make regular payments on your car loan. Perhaps you’re constantly on edge from debt collectors calling at all hours of the day and night, demanding immediate payment. Once you’ve fallen into debt, it can seem like you’ll never be able to escape. All the while, you just need someone to help you dig a way out.
This is especially true with credit card debt. It’s not uncommon for American families to carry some credit card debt from month to month, and usually it’s not an issue. But if you suddenly lose your job or have an extended stay in the hospital, you may suddenly not be able to maintain payments because of your credit card’s high interest rate.
If you find yourself in a neverending debt spiral, it’s time to contact an experienced Aurora bankruptcy attorney.
We know filing for bankruptcy can be extremely scary and stressful and that you need to know you’re in good hands with the bankruptcy law firm you’ve chosen. You want to feel safe in a time when you’re vulnerable. You need to know that your Aurora area bankruptcy lawyer is going to have your absolute best interest at heart.
We want you to know you’re safe with us. Our Aurora bankruptcy attorneys are incredibly skilled, experienced, passionate and, most of all, committed to providing the very best solution for your specific needs. Contact our firm today for a free case evaluation.
Before we delve into how filing for bankruptcy in Aurora can help you with your credit card debt, you need to understand two very important bankruptcy terms that you will hear frequently throughout your bankruptcy case- secured debt and unsecured debt.
Secured debt requires you to back it with collateral, such as your car loan or mortgage, as part of the application process. This collateral works to get you a lower interest rate on your loan but you risk losing your asset if you fail to repay the loan.
Unsecured debt doesn’t require collateral, so approval is generally based on your credit score. Unsecured loans usually carry a higher interest rate than secured debt because if you fail to pay your loan, you won’t risk losing your assets.
Credit card debt is considered unsecured debt, and the good news is that in almost all cases your unmanageable credit card debt can be eliminated or extremely reduced in both Chapter 7 and Chapter 13 bankruptcies.
Chapter 7 bankruptcy is the most common form of bankruptcy and is frequently referred to as “liquidation bankruptcy.” Under Chapter 7, all of your non-exempt property can be sold by a court-appointed bankruptcy trustee to partially or fully satisfy your debts. However, given the very generous exemptions available to Coloradans the vast majority of Chapter 7 filings are “No Asset” cases, meaning the Chapter 7 bankruptcy trustee liquidates nothing. Following the trustee’s administration of the Chapter 7 case, most unsecured debts are discharged, or wiped clean.
Chapter 13 bankruptcy, also known as a “wage-earners bankruptcy” works a little differently than Chapter 7 to discharge unsecured debts like credit card debt. Chapter 13 bankruptcy offers certain benefits such as property protection and debt discharge in exchange for a promise to pay back all or a portion of your debts through a payment plan.
Chapter 13 does not necessarily require full repayment of all debts — only past-due secured debts and priority debts, such as child support or recent income taxes must be paid in full. The amount you repay is based on your financial situation, including your income and the amount and type of debt you owe. At the end of your repayment plan, any leftover unsecured debt is discharged or erased.
Don’t waste another day buried by credit card debt. If you would like more information about how Chapter 7 or Chapter 13 bankruptcy can help you erase your credit card debt, contact one of our experienced Arapahoe County bankruptcy attorneys today for a free case consultation.
Making ends meet each month can be a stretch at the best of times for many Aurora residents. When unexpected life events — such as illness, divorce, or loss of work — occur or unexpected bills arise, meeting monthly bills can go from hard to impossible. Many people are forced to turn to credit cards to keep up with the daily costs of living. Unfortunately, this cycle often results in an ever-growing mountain of debt.
Debt relief agencies, also sometimes called debt consolidation services, may seem like a safer, cheaper, or easier option for debt relief instead of filing for bankruptcy in Aurora. And the truth is, that may be true for some people, with some debt relief agencies. But before you decide to go that route, our experienced CO bankruptcy attorneys urge you to do your due diligence. While many of these companies are upfront and above board, some exist solely to prey upon desperate people who are searching for fast and easy debt relief.
One of the most prevalent debt relief scams in Aurora preys on Coloradans with student loan debt. Almost 750,000 residents of Colorado are currently strapped with student loan debt. And because student loan debts don’t generally get covered by filing for bankruptcy in Colorado, many desperate people are falling for these predatory debt relief company cons.
As a matter of fact, student loan debt relief scams are so prevalent that the Office of the Attorney General has released a warning about these specific fraudulent companies on their website.
Another shady tactic predatory debt relief agencies will use is that they ask you to cancel all your credit cards or set up an escrow account and make monthly payments to them through the account. These companies actually use the escrow account to pay your credit card’s minimum amount due skimming off the top for as much money as they can until you have enough money in the escrow account to leverage a debt settlement with a credit card company. However, by the time you’ve accumulated enough money to allow your debt settlement company to convince a creditor to accept a debt settlement, you could have hired an attorney and saved thousands of dollars through bankruptcy.
Again, we stress that not all debt relief agencies are out to swindle you out of your hard-earned money. The Colorado Uniform Debt Management Services Act (DMSA) regulates companies that offer and provide debt management services to Colorado residents. Use a trusted non-profit website like InChargeDebtSolution.org as a resource to find reliable debt relief agencies in Colorado. Or contact one of our knowledgeable Aurora bankruptcy attorneys today to figure out which avenue of debt relief is right for you.
Credit Cards are a slippery financial slope. They aren’t inherently good or bad, but the mismanagement of credit cards can lead to an insurmountable amount of debt. If you have been struggling with credit card debt, filing for bankruptcy may be the best way to get the fresh start you deserve. Our team of Colorado bankruptcy lawyers strives to make the bankruptcy process as easy as possible for you and your family. We are here to support you every step of the way.
Our Aurora area debt relief lawyers have decades of experience helping Coloradans like you overcome financial hardship. We offer a free case consultation to prospective clients, during which we will work with you to develop a creative debt relief strategy tailored to your needs. Throughout the state, we have made a name for ourselves with our attentive, effective legal services. Every case is different, but no case is too complex for our Aurora bankruptcy law firm.