Chapter 7 Bankruptcy
The Bankruptcy Process
The Colorado bankruptcy process is designed to help consumers and businesses address their debt under the protection of the United States Bankruptcy Court. There are two options for most individuals: Chapter 7 (Liquidation) and Chapter 13 (Reorganization). Each Chapter has benefits and drawbacks. An experienced bankruptcy attorney can help you determine which route is best for you to protect your car, house, and other assets.
In 2005, Congress amended the bankruptcy code to limit the availability of bankruptcy relief. The procedures were made stricter and additional requirements were added that must be met before a discharge can be entered. After these changes, it has become even more difficult to successfully navigate the system without the aid of experienced counsel. We can help you protect your property and ensure that the process proceeds as smoothly as possible.
What is Chapter 7 Bankruptcy?
Chapter 7 bankruptcy refers to the corresponding section of the United States Bankruptcy Code that has to do with liquidation. In a Chapter 7 case, a bankruptcy trustee is appointed to evaluate any non-exempt assets. In Chapter 7 bankruptcy, you ask the bankruptcy court to discharge most of unsecured the debts you owe (credit cards, medical bills, payday loans, etc). In exchange for this discharge, the bankruptcy trustee can take any property you own that is not exempt from collection, sell it, and distribute the proceeds to your creditors.
In most cases, creditors do not receive the full amount owed and in many cases creditors receive no payment at all. You are allowed to keep all exempt property and are given a fresh start free of the discharged debts.
Not everyone can file under Chapter 7. A person with primarily consumer debts will be denied a discharge if their income exceeds guidelines based upon the number of people in their household. An experienced attorney can help you ensure that the process goes as smoothly as possible and help you protect as much of your property as possible. Call us and let’s get started working on your fresh start.