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Dealing with debt can be a disheartening experience, especially when you believe you are about to lose everything. Fortunately, there are options provided for those struggling with debts. Filing for bankruptcy can help alleviate the financial burden and stop creditor harassment. Our Colorado bankruptcy team details the bankruptcy exemptions allotted to Colorado residents and the protections you are entitled to after filing.
Understanding Bankruptcy
Bankruptcy is the legal process where individuals who cannot repay debts to creditors may seek relief from some or all of their debts. Chapter 7 bankruptcy is one of the most common chapters filed. After filing chapter 7 bankruptcy, a judge will order all non-exempt assets to be liquidated, and the proceeds will repay the creditors. Unlike chapter 13, chapter 7 bankruptcy does not require a repayment plan, offering those who file a "fresh start." Colorado offers its residents several exemptions that protect their property, including homes and vehicles.
Colorado Homestead Exemption
One of the biggest worries most individuals filing for bankruptcy have is whether or not they will lose their homes. Colorado law offers the Colorado homestead exemption, allowing filers to protect up to $75,000 of home equity.
Example: If you own a house worth $150,000 and have a mortgage balance of $80,000, you have $70,000 of equity in the property. If you file a chapter 7 bankruptcy, the Colorado homestead exemption will protect your entire equity.
Vehicle
In most cases, you won't lose your vehicle during your Chapter 7 bankruptcy in Colorado if the exemption fully covers the car's equity. The exemption for equity on a vehicle is $7,500 per filer. For filers who are sixty or older or disabled, it protects $12,500 per filer.
Creditor Harassment
Once you file for bankruptcy, automatic stay halts creditor harassment. With bankruptcy filed, debtors cannot contact you to collect debts. This protection is often a massive relief for filers with various debtors accosting them.
It is highly recommended to seek the assistance of a bankruptcy lawyer. A lawyer will assess your particular situation and advise you on what chapter best suits your needs.
How We Can Help
Here at Wagner Law Office, P.C., we understand how daunting filing for bankruptcy can be. Our experienced team is committed to providing you with the legal guidance you need to reach the financial freedom you deserve.
If you would like to learn more about how we can help you through filing for bankruptcy, don't hesitate to call our award-winning team today at to schedule your free consultation.