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Frequently Asked Questions

Can I keep my home if I file bankruptcy in Colorado?

In the vast majority of cases, yes, you can keep your house if you file a bankruptcy. There are some exceptions based on payment history, amount of equity in the house, and other factors. Speak to a Denver Bankruptcy Attorney today to determine if any of those exceptions are likely to apply.

Can I keep my car if I file bankruptcy in Colorado?

In the vast majority of cases, yes, you can keep your vehicle if you file a bankruptcy in Colorado. Like with your house, there are some exceptions based on payment history, amount of equity in the vehicle, and some other factors. Speak to a Denver Bankruptcy Attorney today to determine if any of those exceptions are likely to apply.

Can I keep my furniture, tv, appliances, and other household property if I file bankruptcy in Colorado?

Most of the common items of personal property including furniture, household appliances, tvs, clothes, are deemed “exempt” which means “protected” from being taken in a bankruptcy. There are some limits on the total combined value of personal property that you can keep in a bankruptcy, but since the value of your personal property is determined by its current resale value as opposed to its original purchase price or its replacement cost, most people do not own furniture and other household items that exceed the allowable limits. One of my primary jobs as a Bankruptcy Attorney in Denver, Colorado is to make sure that my clients’ bankruptcy petitions are drafted properly to protect the maximum amount of all kinds of property that can be protected. Speak to a Denver Bankruptcy Attorney today if you have additional questions about particular items of property and whether or not those items would be protected if you file bankruptcy.

Will I lose my retirement savings (401(k), IRA, PERA, 457) if I file bankruptcy in Colorado?

With very, very rare exceptions, no, you will not lose your retirement savings if you file bankruptcy in Denver, Colorado. This is one very good reason to speak to a Denver Bankruptcy lawyer if you are considering using your retirement savings to pay off debt. Many people consider using their retirement savings to pay down their debt. While this can sometimes work, it is very important to consider the full debt picture before spending the retirement funds that you worked hard to save. There may be options to keep your retirement savings and get rid of your debt, including bankruptcy, but if you are considering spending your retirement money to satisfy debt, I recommend first speaking with a lawyer licensed in Colorado to make sure you maximize your savings.

How do I stop a wage garnishment in Colorado (will filing a bankruptcy in Colorado stop a wage garnishment)?

Yes, filing a bankruptcy will stop a wage garnishment in Colorado (with some very rare exceptions) immediately upon the filing of the bankruptcy case. On the same date a bankruptcy is filed in Denver, Colorado, an “automatic stay” is imposed immediately which prohibits your creditors from taking ANY collection actions without special permission from the bankruptcy court. This means that a wage garnishment MUST cease immediately on the date you file your bankruptcy. Bankruptcy is the most effective way to stop a garnishment. Typically there are very few non-bankruptcy options to stop a wage garnishment in Colorado unless the creditor who is garnishing you is willing to voluntarily release the garnishment. Note that a creditor voluntarily releasing a garnishment is particularly uncommon because of the amount of time and effort it took the creditor to get a garnishment in place.

I received a summons and complaint to appear in a Colorado court, what should I do?

Note first and foremost that the reasons you might be summoned to court vary greatly, so there will be no “one-size-fits-all” answer to this question. Receiving a summons and complaint in Colorado triggers deadlines for you to either file an answer or otherwise handle the case. If you do nothing to respond to the summons and complaint, a “Default Judgment” will most likely enter meaning that you will miss your only opportunity to challenge the facts stated in the Complaint. If a default judgment or other judgment enters, then the person or company who filed the lawsuit against you can then garnish your wages, levy (“freeze”) your bank accounts or pursue other remedies. If you have received a summons and complaint in Colorado, you should speak with a licensed Colorado Attorney as soon as possible to avoid missing any important deadlines.

If you file a bankruptcy, an “automatic stay” is imposed immediately against your creditors. This means that if there was a civil lawsuit pending against you (ie you were given a summons and complaint to appear in a Colorado court for a debt or other civil lawsuit) that civil lawsuit must also stop (it must be “stayed”) immediately.

Can I get rid of (can I “discharge”) credit card debt if I file bankruptcy?

Yes, debt from credit cards can be discharged in a Colorado bankruptcy, which means if your case goes through successfully you will be relieved of your credit card debt. There are only very rare exceptions to this rule. Contact a Denver Bankruptcy Attorney today for further information.

Can I get rid of my medical bills/debt if I file bankruptcy (can I “discharge” medical bills/debt)?

Yes, medical bills can be included in a Colorado bankruptcy, which means that if your case goes through successfully you will be relieved of any of your medical bills that were incurred prior to the date you file your bankruptcy case.

Can I get rid of debt from payday loans or cash advances if I file bankruptcy (Can I “discharge” payday loans or cash advances)?

Yes, debt from payday loans and cash advances can be included in a bankruptcy in Colorado. This means that you can eliminate debt from payday loans and/or cash advances if you file a bankruptcy in Denver, Colorado. There are some time limitations that apply, but generally these types of debt can be included in your bankruptcy discharge, which means you will not have to pay the payday loans or cash advances as long as your case goes through successfully.

Can I get rid of tax debt if I file bankruptcy (can I “discharge” taxes in a bankruptcy) in Colorado?

Some taxes can be eliminated by filing a bankruptcy in Colorado. This is a rather complex area of bankruptcy law, so if you have tax questions, I would strongly recommend speaking with a Denver Bankruptcy Attorney. Certain older taxes and some tax penalties can be discharged if you file bankruptcy in Denver, Colorado. Tax debt from recent years (generally) cannot be eliminated by a Chapter 7 bankruptcy. However, if you file a Chapter 13, you will be able to (and in fact, required to) pay those recent tax years. One benefit to Chapter 13 is that rather than the IRS or State of Colorado garnishing your wages or levying your bank accounts or property, you will be allowed to pay the taxes over time by spreading those payments over a longer period (normally 36-60 months).

Can I get rid of Student Loan Debt in a bankruptcy (Can I “discharge” student loan debt in a bankruptcy) in Colorado?

Technically there is a possibility of getting student loans discharged in bankruptcy, but the standard to get student loans discharged is very high, and few people qualify for student loan discharge through bankruptcy. The general rule is that student loans are not dischargeable in bankruptcy meaning that they will still be owed after your bankruptcy case is completed. However, in a Chapter 13 case, you may not be required to make your monthly payments on federal student loans while your case is pending (usually 36-60 months). Even in Chapter 7, you will get a short break (approximately 3 months) during which you do not have to pay your federal student loans. Private student loans may follow different rules, so check with your attorney about how your student loans may be treated during bankruptcy. Often my clients are relieved to have this break in order to catch their breath for a few months, and in the process get rid of their other unsecured debt, which puts them in a better position to then be prepared to resume student loan payments with less other debt to pay.