Need Help Filing For Bankruptcy In Colorado
If you are having financial trouble, paying a bankruptcy attorney may seem like an expensive luxury when you can file on your own. But personal bankruptcy can be a very complicated process and you will need to closely follow the rules and deadlines or your case will be thrown out of court and you will once again be receiving calls from collection agencies. A local bankruptcy attorney will represent you in court, negotiate with creditors, and ensure that you keep as many of your assets as the law allows.
Note: State laws are always subject to change through the passage of new legislation, rulings in the higher courts , ballot initiatives, and other means. While we strive to provide the most current information available, please consult an attorney or conduct your own legal research to verify the state law you are researching.
Colorado Bankruptcy Means Test
The Colorado bankruptcy means test is the calculation that helps the court make sure that only folks who really need relief under Chapter 7 can actually file a Chapter 7 bankruptcy in Colorado. It first compares your household income with the applicable income limits for Colorado. If you make less than the median household income for a household of your size, you pass the means test. If you make more money than that, you may nevertheless qualify to file a Chapter 7 bankruptcy in Colorado if part two of the Colorado bankruptcy means test determines that, given your specific circumstances, you are unable to pay even a portion of your debts over the next five years.
Data on Median income levels for Colorado
Colorado Median Income Standards for Means Test for Cases Filed On or After May 1,2021 |
|---|
| Household Size |
| $6,717.50 |
What Is The Secret To Knowing If Your Credit Score Will Go Up After Filing Bankruptcy
Just as there is no real secret pill to lose weight, there is no easy secret to know if your credit score will be restored after filing bankruptcy. There can be a dramatic shift in your score after the bankruptcy if you had a stronger credit score to start with, usually 650 or greater. If the score is low to start with there will not be as much of a noticeable decrease.
It is possible to use some credit reporting tools to get an estimation of what the decrease will be, as well as the estimated 12-month post- bankruptcy score.
It is a common myth that your credit score stays low for seven to ten years following a bankruptcy.
This is simply not true. The seven to ten year period is how long the actual notation of the Bankruptcy Filing as a public record will stay on your credit report.
In fact, if you are diligent in your efforts to rebuild your credit, it is entirely possible to be back in the 700s within two years from the filing of a bankruptcy. This includes knowing your current score, using a credit card wisely by repaying it in full each month, and staying vigilant to notice changes in your score.
An experienced bankruptcy attorney can help guide you on how to go about re-establishing credit post-bankruptcy as well as how to monitor your credit to make sure that none of the debts included in the bankruptcy comes back to detrimentally impact your score, which is illegal once the case is filed.
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Chapter 13 Bankruptcy Colorado: 7 Things You Need To Know
You may wonder whether filing Chapter 13 bankruptcy in Colorado is the best debt relief option. Bankruptcy is a common relief option. In fact, there were 7,402 bankruptcies that have been filed in Colorado by June 30th, 2021.
The purpose of this article is to provide what you need to know about Chapter 13 bankruptcy in Colorado. Heres what we will cover:
- Chapter 7 vs. Chapter 13 Bankruptcy in Colorado
- Calculating Chapter 13 Plan Payments in Colorado
- Filing for Chapter 13 Bankruptcy Colorado Process
- Colorado Bankruptcy Exemptions
- Bankruptcy Courts and Trustees for Colorado
- Colorado Chapter 13 Bankruptcy FAQs
- Alternatives to Filing Bankruptcy in Colorado
Should I Pursue A Chapter 13 Bankruptcy Case In Colorado
In short, deciding to file a Chapter 13 bankruptcy case in Colorado can be overwhelming. Before you file bankruptcy, you may want to estimate your Chapter 13 plan payment that you can compare against your current monthly debt obligations. You can compare that plan payment estimate to your Chapter 13 bankruptcy alternatives below.
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How Does Business Bankruptcy Affect Credit
Compared to other business entities, sole proprietors will take the biggest hit to their personal credit after filing for bankruptcy. Unlike registered entities like LLCs and corporations, sole proprietors have no legal distinction between personal and business debts. After all, you cant expect to have your debts discharged without paying some price. Sole proprietors should expect to see their scores go down by at least 120 points, and the bankruptcy will stay on their credit report for at least seven years.
Owners of registered business entities are not personally responsible for business debts. Hence, their personal credit scores may take little if any damage from bankruptcies. The unpaid debts and bankruptcy also wont show up on their personal credit reports. They will, however, show up on your business credit report. Individual financial institutions might review your business credit before approving financing. Vendors and suppliers will look at your business credit score before deciding to work with you as well.
But, there is one condition in which business debts can affect registered business entities personal credit scores.
How Will Filing Bankruptcy Affect My Spouse Or Significant Other
This question may require a different answer depending on where you live.
There are common law states, and there are community property states. Most states are considered common law states, including Colorado.
In common law states, if your name is on a deed, you own that property. If you and your spouse both share a name on the deed or title, you own a half interest in the property. If there is no title, you own it if you can prove you paid for it.
In community property states, both spouses own an equal share of most property acquired during the marriage regardless of whose name is on what deed.
In bankruptcy, several problems may arise in common law states. First, if property with joint ownership cannot be easily divided, it may be sold and half of the proceeds applied to your debts. Of course, the trustee must show here that the benefit of selling this property would outweigh the detriment to your spouse.
Second, although your debts may be discharged, this does not affect how much your spouse is now responsible for. Thus, he or she may be required to pay off any joint debts now without the help of your combined salary.
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How To File For Bankruptcy
If you think you might need to file for bankruptcy, use this calculation before deciding: can you pay off your debts within five years? If the answer is no, then you might be eligible to file for bankruptcy.
You can file for bankruptcy yourself or hire a bankruptcy attorney to help you. However, because the laws can be complex and you wont want to make a misstep, it might be helpful to get some assistance.
When To File A Corporate Bankruptcy In Colorado
Many of my bankruptcy clients in Colorado own a small business the business debt of which the client has personally guaranteed. Particularly in todays quite restrictive lending environment, a bank simply will not loan money to a small business absent a personal guarantee of the business debt by the business owner. What then happens when the business owner needs to file for bankruptcy?
As an experienced Denver business bankruptcy lawyer, I frequently advise my self-employed clients that a personal bankruptcy will discharge most personal unsecured debt and any personal guarantees made on business debt, but that the bankruptcy will not discharge the business debt itself. What this means is that any creditors of the business can still file a lawsuit against the business itself for any business debts . But, the automatic stay provisions prevent these same creditors from pursuing the debtor personally.
Lets examine the chapters of bankruptcy available to a corporation. The Bankruptcy Code only permits individuals, and not any type of corporation or other business entity, to file. So, a corporation only has two chapters to elect: chapter 7 or chapter 11.
Chapter 11 is rarely the best option for a small business owner. Chapter 11 matters are extremely complex and very expensive. Chapter 11 may be feasible for a business owner who intends to continue operation of the company in which a payment plan is proposed to creditors.
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United States Bankruptcy Court
Bankruptcy is a set of federal laws and rules that can help individuals and businesses who owe more debt than they can pay. Each of the 94 federal judicial districts handles bankruptcy matters, and in almost all districts, bankruptcy cases are filed in the bankruptcy court. Bankruptcy cases cannot be filed in state court. Bankruptcy laws help people who can no longer pay their creditors get a fresh start by liquidating their assets to pay their debts, or by creating a repayment plan.
Bankruptcy laws also protect troubled businesses and provide for orderly distributions to business creditors through reorganization or liquidation. These procedures are covered under Title 11 of the United States Code . The vast majority of cases are filed under the three main chapters of the Bankruptcy Code, which are Chapter 7, Chapter 11, and Chapter 13.
Federal courts have exclusive jurisdiction over bankruptcy cases. This means that a bankruptcy case cannot be filed in a state court.
The primary purposes of the law of bankruptcy are:
- to give an honest debtor a “fresh start” in life by relieving the debtor of most debts, and
- to repay creditors in an orderly manner to the extent that the debtor has property available for payment.
Some bankruptcy cases are filed to allow a debtor to reorganize and establish a plan to repay creditors, while other cases involve liquidation of the debtor’s property.
Flat Fee Colorado Bankruptcy Attorneys
We work on a flat fee basis. Once we set our fee, thats it. Our fee includes complete representation throughout the entire bankruptcy process. Well prepare your bankruptcy petition, appear at your meeting of creditors, respond to any inquiries by creditors and trustees, and address any objections to your bankruptcy discharge.
Youll be able to reach your bankruptcy attorney any time of the day or night, including weekends. If your attorney cant talk to you when you call, hell return your as soon as possible. We know that this is a difficult time for our clients, and our goal is to make it as stress free as possible. Finally, our relationship doesnt end until your bankruptcy court closes your case, and we dont charge you anything more for calls to answer questions after that. We want you to be happy with our services.
Unlike most other bankruptcy attorneys, our fee also includes a full credit report and the cost of the online education classes you have to take when you file bankruptcy. This saves you time and money in getting your bankruptcy filed.
In addition to our fees, you will be responsible for the following fees charged by the U.S. Bankruptcy Court and required by the U.S. Bankruptcy Code:
Chapter 7 filing fees: $338.00
Chapter 13 filing fees: $313.00
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Will Filing Bankruptcy Make The Creditors Stop Calling And Harassing Me
The automatic stay following a bankruptcy is a protective device to discontinue all actions from your creditors in attempting to collect a debt. Thus, phone calls from your creditors will discontinue.
What if a creditor doesnt follow this order and calls anyway? The first step is to simply tell the creditor that you have filed bankruptcy. It is possible they are simply unaware that you have begun this process. If the calls persist, the next step is to notify your bankruptcy attorney.
An experienced attorney will help you to see that your creditor is sanctioned for harassing you against an automatic stay.
This requires a showing that they violated the order willfully. In other words, the collector must know of the bankruptcy case, and either ignore it or fail to correct its actions after learning about it. The creditor must act intentionally, and the automatic stay must still be in place.
If your attorney can prove these elements, your creditor will be sanctioned and required to discontinue calls to collect from you. There is the ability to collect at least $1,000, but if you suffered actual damages such as a medical episode because of it, you can also ask for punitive damages from the court which can be quite substantial.
Bankruptcy Myth #: I Make Too Much Money To File Bankruptcy
Anyone can file a bankruptcy at any income level. However, the Chapter of bankruptcy may be determined by your income.
This does not mean people with high incomes do not qualify for Chapter 7 bankruptcy. There are people who qualify for Chapter 7 bankruptcy that make well over a $100,000 a year or even more.
For example, a business owner with significant business debts may qualify for an exception from the income tests applied in a Chapter 7 bankruptcy. This exception along with proper review and advice on your expenses can result in receiving a Chapter 7 bankruptcy instead of a payment plan bankruptcy.
Work with an experienced bankruptcy attorney to determine what exceptions may apply in your case. Otherwise, you risk having to needlessly repay debts because your attorney does not know the rules. Experience counts and saves you money and further hardship.
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What Happens When I File Chapter 13
The forms for Chapter 13 are very similar to the forms for a Chapter 7 but the main difference is that in Chapter 13 the debtor must also file a Plan. The early goal of Chapter13 is to get this plan confirmed by the Court . There may be objections from creditors and/or the Chapter 13 Trustee that need to be resolved before the plan can be confirmed. The Bankruptcy Code has very specific requirements that the plan must meet. These requirements mandate that the plan treat certain creditors in a certain way. The confirmation process is typically 3-5 months after the case is filed. It will usually take several plans before a plan gets final confirmation. Contested matters can include: valuation of certain assets, disposable income, treatment of certain claims in the plan and other issues .
Just like in Chapter 7, a Chapter 13 filing puts into effect the Automatic Stay which protects the debtor from most creditor action. The Chapter 13 Plan will require that the debtor make monthly payments to the Chapter 13 Trustee. The first payment is due 30 days after the case is filed. The Trustee is placed in charge of distributing those funds to all relevant creditors, depending on how the plan treats them. The Trustee doesnt begin to pay creditors pursuant to the plan until the plan is confirmed.
Secured Vs Unsecured Debt
If you are thinking about filing bankruptcy you must understand that your debts will be designated as either secured or unsecured. This designation plays a major role in bankruptcy because it dictates how much debt you can eliminate. Additionally, secured and unsecured assets are treated differently when you file for Chapter 7 or Chapter 13.
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How Long Does It Take To File For Business Bankruptcy
The length of the entire bankruptcy process depends on the type. A sole proprietor who files Chapter 7 will likely be wholly discharged from their debts within four to six months. Chapter 13 is mostly filed by sole proprietors as well. For this reason, it usually doesnt take more than six months to develop a reorganization plan and get it approved by a few creditors and the bankruptcy court. Depending on the plans terms, however, it could take anywhere from three to ten years for the filer to repay all of their debts.
Chapter 11 takes significantly more time than Chapter 13 since it usually involves larger businesses with many creditors. The more creditors you have and the more money you owe, the longer it takes for creditors to approve your reorganization plan.
During the court proceedings, creditors often question the filer about their reorganization plan and take several months to approve it. It could take well over a year for each creditor and the bankruptcy to approve the plan. This lengthy process will also result in outrageous legal fees.
Bankruptcy Laws In Colorado Chapter 7
additional information Bankruptcy Laws In Colorado Chapter 7
Consumer bankruptcy Legal professionals Reduce Personal Worries
It was formerly that a person may possibly declare bankruptcy virtually on impulse, simply to leave under a large stress associated with commitments. Then that individual would likely start again, plus a few decades following file bankruptcy yet again. This sort of situation just isn’t straightforward for just about the most medicare part a results of the brand new individual bankruptcy regulation.
The a bankruptcy proceeding guidelines even so vary from region to region but many of the largest foundation within individual bankruptcy principles is constantly on the each of the declares. These versions in addition to adjustments that will be state particular are, in most cases, instead tiny points. What’utes more, one of many effects of the present regulations tend to be as it were declare bankruptcy, you want to do that will inside condition whereby you might be a resident, so that you cannot just go to a new express to file personal bankruptcy for the reason that they might have more lax regulations using some regions.
Bankruptcy Laws In Colorado Chapter 7
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Bankruptcy Laws In Colorado Chapter 7
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