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Find Debt Relief With Help From Our Thornton Bankruptcy Attorneys

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For many Thorton residents, the looming recession expected in 2023 adds to the uncertainty of financial security. While Colorado has a poverty rate lower than the national average, nearly 10% of Colorado residents live below the poverty line. If you are one of these individuals living in Thornton, one unplanned expense could be the single hit that leads to finding yourself behind on bills and considering bankruptcy.

If you are one of the individuals considering bankruptcy in Adams County, know that you are not alone. You are one of the 400,000 Americans filing for bankruptcy each year – which translates to over 1,000 individuals filing for bankruptcy each day.

The simplified question of “Should I file for bankruptcy?” assumes there is a general benchmark that qualifies one for bankruptcy. The array of considerations determining the best option in your unique situation needs the knowledge of an Adams County bankruptcy attorney. However, there are several common financial struggles associated with filing consideration:

  • Consistent attempts to collect a debt
  • Insufficient income or assets to offset debts
  • Missed monthly minimum payments
  • Concerns about home foreclosure or vehicle repossession
  • Garnished wages
  • Debt-related legal trouble

According to a recent study, the number one reason Colorado residents file bankruptcy is that they find themselves unable to pay their medical bills. Not limited to Colorado alone, this is a common theme for many across the United States considering a bankruptcy filing. After filing for bankruptcy, an individual struggling in a financial crisis has the opportunity to rebuild and get back in good financial standing.

If you are in debt, filing for bankruptcy may feel like taking a drastic step. However, it is actually the end of a mentally exhausting cycle and the start of a brighter financial future. Rarely do you get a second chance in life, but bankruptcy allows you to do just that.
Hundreds of thousands or more across the United States are experiencing the stress associated with uncontrolled debt. Rather than delay another second, contact our law office and speak to one of our Thorton bankruptcy attorneys to get specific information regarding your unique situation.

Understanding The Bankruptcy Filing Process In Thornton, Colorado

If you decide to file for bankruptcy, you should understand the sequence of events that will follow once you have made your choice. Our team of Thornton attorneys specializing in bankruptcy is here to help you understand your options, make confident decisions, and take action to resolve your financial issues. Steps involved with the bankruptcy filing process include:

  • Beginning Credit Counseling – All debtors are required to take a Credit Counseling course before filing a bankruptcy petition, and the credit counseling agency will provide a certificate of completion once the course has been completed. Agencies offering the course must be approved by the U.S. Trustee’s office before filing for bankruptcy. Once the course is complete, you have 180 days to process your filing, which is why it is recommended to meet with one of our legal attorneys first.
  • Collecting Bankruptcy Schedules – Schedules in this context refer to the documentation required for filing. Bankruptcy schedules include but are not limited to: several years of previous tax filings, bank statements for every account, stock and investment accounts, 401K statements, pension, retirement plans, appraisal of assets like property or real estate, proof of income for the past six months, lists of creditors with estimated balance, and monthly expenses ranging from housing costs to utility payments. Filing alongside an Adams County bankruptcy attorney provides peace of mind that all schedules have been handled appropriately.
  • Filing The Bankruptcy Petition: Colorado individuals have two options under US Code Title 11 when filing a bankruptcy petition. They can file for Chapter 7 bankruptcy, also known as “liquidation bankruptcy”, a system where you sell off your assets to pay down your debts. The other option for Colorado individuals is Chapter 13, also known as a “reorganization bankruptcy”, which involves a court-mandated repayment system.On the surface, Chapter 7 and Chapter 13 may appear to be very similar. Both chapters eliminate unsecured debt like credit cards, loans, and medical collections, while Chapter 13 creates provisions to resolve past-due secured debt like housing and vehicles. You will need to speak to your Adams County bankruptcy attorney to determine which is best for you.
  • Filing Chapter 7: According to the IRS, “Liquidation under Chapter 7 is a common form of bankruptcy. It is available to individuals who cannot make regular, monthly payments toward their debts.” Chapter 7 is one of the most common forms of bankruptcy as it is an option for individuals.
  • Filing Chapter 13: Even more common than Chapter 7 is Chapter 13. According to the IRS, “Chapter 13 bankruptcy is only available to wage earners, the self-employed and sole proprietors (one-person businesses). To qualify for Chapter 13, you must have a regular income, have filed all required tax returns for tax periods ending within four years of your bankruptcy filing, and meet other requirements outlined in the bankruptcy code.”
  • Filing The Bankruptcy Petition: This petition is a collection of forms disclosing your schedules and providing the courts with your financial standing. Filing alongside an Adams County bankruptcy attorney ensures the petition has been filed correctly with all necessary information.

    Filing the petition is done digitally in Colorado’s Adams County. You and your lawyer will both complete the online forms available with The United States Bankruptcy Court, District of Colorado. If you are filing Chapter 13, you will also submit the proposed repayment plan to cover your debts.

  • Attending The 341(a) Meeting of Creditors: This is one of the legal terms you’ll quickly recognize as you meet with your bankruptcy lawyer in Thorton, Colorado. This hearing, excluding the judge on your case, gathers all of your creditors to gain a better understanding of your financial situation through a series of questions. Your Thornton, Colorado bankruptcy attorney will work closely with you to prepare for the expected questions based on your circumstances.
    Your creditors are notified of 341(a) Meeting with a Notice of Commencement of Case. However, they may not choose to appear. After the meeting, they will have 60 days to raise any objections or bring about any questions regarding the bankruptcy proceedings.
  • Next Steps for Chapter 7 Bankruptcy: Within two months of the 341(a) hearing, you’ll complete a Debt Education Course. This is different from the Credit Counseling done earlier in the process. This course will conclude with the earning of a certificate to file with the bankruptcy court in Thorton. Once the final documentation has been provided to the court, the final step of your Chapter 7 filing is obtaining a discharge order releasing you of the unsecured debt.
  • Next Steps for Chapter 13 Bankruptcy: After the 341(a) hearing, you’ll receive a confirmation hearing date for your day in court. During this hearing, the Judge will review the aspects of your bankruptcy to determine if your Chapter 13 filing will be confirmed. Once confirmed, the court will arrange your mandated Chapter 13 repayments of secured debts over the next 3 to 5 years. The final step in your bankruptcy process is the completion of the Debt Education Course.

This condensed recap of the process is simplified to help to guide you through the overall experience. The process of filing for bankruptcy in Colorado is not as easy as it may seem to some. Hiring local representation, however, can help to provide a confident experience from the first step to the last. Our lawyers are experienced in the bankruptcy filing process, the dismissal of your unsecured debt, and advising which chapter best fits your financial situation.

Commonly Asked Questions About Bankruptcy In Thornton, Colorado

Questions are normal when it comes to the bankruptcy filing process. Here are our most frequently asked questions in Thornton. Colorado to help you as you explore your bankruptcy options:

How Much Debt Do You Need To Have To File Bankruptcy?

Whether you file Chapter 7 or Chapter 13, most lawyers will advise a minimum in unsecured debt of $10,000. Chapter 7 filing specifically requests for the liquidation of debts. When your income doesn’t allow you to meet the requirements to keep debts in good standing, no matter the amount, you may qualify for debt relief with Chapter 7. As Chapter 13 also impacts unsecured debt, the secured debt allows you to have the details of good standing prolonged over 3 to 5 years while retaining assets like housing and vehicles.

One important thing to note is that, before you can file for Chapter 7 in the state of Colorado, you must complete the Colorado Means Test, which looks at your income against the state median and your disposable income. If your income is too high, you may not qualify for Chapter 7.

How Long Will Bankruptcy Show On My Credit Report?

Bankruptcy filings of any form will show up on your credit report and the process of rebuilding your credit score takes time. This is an important consideration to review with your bankruptcy attorney in Adams County to make the best decision for you.
With Chapter 7 filings, the request for liquidation encompasses the majority of the individual’s debt and stays on your credit report for approximately 10 years. With Chapter 13, the filing acknowledges the intent to return to good standing on your secured debts. The act of good faith is taken into consideration, typically reducing the impact on your credit report to 7 years.
Deciding to file for any form of bankruptcy has lasting effects. This is another reason we do not recommend embarking on the legal process without legal counsel. Always consult with your Thornton bankruptcy lawyer before making any decisions regarding your bankruptcy.

Will Bankruptcy Eliminate All My Debt?

Debt carries different classifications. Unsecured debts are traditional credit cards, personal loans, and medical bills. Secured debts are backed by collateral. Defaulting on these accounts can result in loss of assets, housing foreclosure, and repossession of vehicles.

There is yet another category of debt known as non-dischargeable. Non-dischargeable debts include tax debts, child support, alimony, government fines or penalties, personal injury debts, criminal restitution, and more. A Judge may rule for some debts to remain depending on the requests from the creditors during the Meeting of Creditors.

Unfortunately, due to the complicated nature of debts, no two bankruptcy situations are exactly the same.. As you work closely with one of our Thornton bankruptcy lawyers, they will help you to understand what can be discharged and what debts may be excluded from the process.

Can Bankruptcy Stop A Home Foreclosure Or Vehicle Repossession?

Home Foreclosure

This question refers to the secured debts covered in Chapter 13 bankruptcy. The filing process includes an Automatic Stay, which refers to creditors being informed of the intent to file bankruptcy. This leads to the halt of foreclosure proceedings and collection actions against you for the duration of the bankruptcy proceeding.

This does not stop foreclosure proceedings entirely. The lender must wait until after bankruptcy has been fully processed before restarting the foreclosure process or seeking to have the automatic stay lifted by the court; a process that takes several weeks to months. Most bankruptcy proceedings conclude approximately 150 days after filing, and your debts may be discharged before the lenders can consider different strategies to regain the debt by lifting the stay or repossessing the home.

This is another complicated part of bankruptcy filings which can be overwhelming for most people. Our legal attorneys will navigate the intricate ins and outs of your case.

Can Bankruptcy Eliminate Medical Bills?

The short answer is medical bills are classified as unsecured debt in both Chapter 7 and Chapter 13 bankruptcies. While these debts are considered part of the filing, it is important to remember that until a judge reaches a confirmation of discharge, you are not guaranteed to have every debt covered under the final ruling.

Can Bankruptcy Discharge My Student Loans?

At one time, student debts were considered unsecured debt. However, this standing changed in the early 2000s to a non-dischargeable debt. This unfortunately means student loans are not covered in any form of bankruptcy filings.

Will The Collection Attempts Stop With Bankruptcy?

Just as an automatic stay is issued to avoid further hardship with foreclosures and repossessions, the same stay applies to unsecured debts. This ends collection attempts until a Colorado judge has reached their final ruling.
If you continue to receive communication regarding collections, please share any communication with your Thorton bankruptcy attorney. Failure to comply with the legal precedence of the automatic stay may lead to harassment penalties against creditors for not operating within legal guidelines.

What Happens After I Have Declared Bankruptcy?

If you’ve declared bankruptcy, you’ll then go through a long and sometimes complex recovery process. The first step is meeting with your creditors, during which time you’ll need to liquidate any nonexempt assets. Some exempt assets include furniture, cars, and personal belongings up to a certain value. However, you will have to give up any nonexempt liquid assets, such as cash or certificates of deposit (CDs), to your trustee. Guidance from a bankruptcy lawyer makes the liquidation process simple and clear.

Can I Rebuild My Credit After Declaring Bankruptcy?

When you’re going through bankruptcy, it’s crucial to start rebuilding your financial standing. To rebuild your credit, you might need to obtain a small line of credit to start. Using the line of credit responsibly shows lenders that you can manage your finances, and are set to slowly fix your flawed credit history. Chapter 7 bankruptcy stays on your credit report for 10 years, while Chapter 13 bankruptcy stays on your credit report for 7 years.

If you start accumulating debt again, focus on a repayment plan early. Under no circumstances take out additional lines of credit until the first line has been paid off. Keep in mind that the interest rate on any line of credit you’re eligible for will likely be high after a bankruptcy filing.

Contact Our Thornton Bankruptcy Attorneys To Learn More

Moon Over Eldorado Canyon State Park

Any situation leading you to consider bankruptcy is a difficult one. The process of determining which form of bankruptcy is best for your financial circumstances, as well as the completion of the filing process, is taxing. You do not have to navigate this process alone. Our experienced bankruptcy attorneys work each day to provide peace of mind from the initial filing until the moment of the judge’s ruling. Contact our office today to start your journey to financial relief.

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