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If you’re a resident of Larimer county living from paycheck to paycheck and falling farther and farther behind on your bills by the day, it may be time to consider filing for bankruptcy.
Like many people, you may be reluctant to consider filing bankruptcy as an option; there are many negative stigmas and myths attached to filing for bankruptcy. However, our Fort Collins Chapter 7 bankruptcy lawyers believe that once you understand more about the bankruptcy process and the benefits of filing for Chapter 7 bankruptcy protection, you may find bankruptcy to be the right choice for you and your family.
If you’re thinking about possibly filing for bankruptcy, then it’s in your best interest to speak with a lawyer who knows the area of law. It is imperative that you don’t just walk into any law office and ask for assistance, as not every lawyer understands the nuances of filing for bankruptcy. To learn more, please contact one of our experienced Fort Collins Chapter 7 bankruptcy attorneys. With over 30 combined years of experience with the Federal Bankruptcy Code, we have the knowledge and skills needed to get you the best outcome for your specific needs.
We have found that during Chapter 7 bankruptcy cases the average person is bound to hear several words they are unfamiliar with. One of the goals of our Fort Collins Chapter 7 bankruptcy attorneys is to make sure every client understands every part of the bankruptcy process. To that end, we have provided the following list of some of the most common terms you’ll likely see or hear if you file for Chapter 7 bankruptcy in Colorado:
341(c) Meeting- You may also hear this referred to as a meeting of creditors. The 341(c) meeting is generally the first (and only) time a debtor has to appear in bankruptcy court. At this meeting, the debtor (or their attorney, if one is attending in the debtor’s stead) is questioned under oath by creditors and a court-appointed trustee about his/her financial affairs.
Asset- An asset is anything that is owned by a person and can be used to pay off debts or meet commitments. Assets by definition have value.
Automatic Stay- Thanks to a provision under United States bankruptcy law, an automatic stay is a legal clause that immediately goes into effect from the moment your bankruptcy motion is filed. The automatic stay can protect you from eviction, foreclosure, wage garnishment, or similar financial disruptions for the duration of your bankruptcy case, allowing you the time and space to give your bankruptcy filing your complete attention.
Discharge- This is what you are seeking when you file for bankruptcy. This discharge order, given by the bankruptcy court, relieves you (the debtor) from all obligations to repay the debts that have been discharged by the court.
Exemptions- Exemptions allow you to keep a certain amount of assets safe in bankruptcy, such as a car, your home, or any professional tools you use for trade. Although Bankruptcy is a federal law, every state has different exemption limits. Some examples of Colorado state bankruptcy exemptions include:
Means Test– The means test is the method used to verify whether petitioners seeking debt relief via Chapter 7 bankruptcy qualify to file. To be more specific, the means test is a formula based on the median income in Colorado and it’s used to determine whether or not you have funds available for debt repayment. This is an extremely simplified definition of the means test. For a more in-depth look at the means test, see The United States Department of Justice-Means Test website or contact an experienced Fort Collins Chapter 7 bankruptcy attorney.
Schedules- Bankruptcy schedules are the documents submitted to the court that include all relevant personal and financial information of the person filing. Your Fort Collins bankruptcy attorney will submit your bankruptcy Schedules online or at the Federal Bankruptcy Court- District of Colorado, which is located in Denver.
Secure Debt- Secured debt is debt that is tied to or secured by an asset, such as a mortgage. It is security in case debt is not paid back. If the borrower cannot repay the loan or misses payments, the lender may seize and sell the collateral.
Trustee- In a bankruptcy case, one of the key people is a person appointed by the court known as a “trustee.” The trustee must manage the bankruptcy process and distribute the property of the person in bankruptcy. Additionally, the trustee must monitor the actions of the bankruptcy parties and make sure the process is run in compliance with applicable laws and the bankruptcy plan.
Unsecured Debt- Refers to credit given to a borrower with no collateral. Chapter 7 bankruptcy will eliminate most, but not all unsecured debts. Unsecured debts can include
This is just a brief list of words that you’ll hear during your Chapter 7 bankruptcy case. If, at any time during your bankruptcy case you hear a word you’re unfamiliar with, make sure you let your Fort Collins bankruptcy lawyer know. We want you to understand exactly what’s happening, every step of the way.
Many people refer to Chapter 7 bankruptcy as a clean slate. You may also see Chapter 7 called “simple bankruptcy” or “liquidation bankruptcy.” Chapter 7 in most cases, allows you to eliminate unsecured debts such as credit card debt, medical bills, and money judgments.
In a Chapter 7 case, you and your experienced Fort Collins bankruptcy attorneys will file a bankruptcy petition that lists all of your assets and debts. Upon filing, the automatic stay order prohibiting creditors from taking any action against the debtor begins. A court-appointed trustee then looks over all of your paperwork and liquidates any non-exempt assets you have. The proceeds of that liquidation are then used to cover your priority debts. Any remaining debt will then be discharged by the bankruptcy court.
It’s worth noting that Chapter 7 bankruptcy can move very quickly. While many types of lawsuits and legal matters can drag on for years, a Chapter 7 bankruptcy case can go from start to finish in 4 to 6 months.
If you’ve been struggling with debt for so long that you’ve begun to feel hopeless, you need to know that help is available. You don’t have to live with creditors harassing you for money you don’t have and payments you can’t make. You don’t have to go through this alone.
Our Fort Collins Chapter 7 bankruptcy attorneys have helped hundreds of clients in situations just like yours across Larimer County. We know that deciding to file for bankruptcy is a tough decision. But just because it’s a hard choice to make doesn’t mean that it’s the right option for you. Contact our experienced Fort Collins debt relief attorneys for a free case consultation, and let us put our experience and knowledge to work for you.