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Do you live paycheck to paycheck?
Are you unable to pay bills?
Do you receive constant phone calls from debt collectors and creditors?
Are you in danger of eviction, having your car repossessed, or your home foreclosed upon?
Is your paycheck being garnished to take care of past-due bills?
It can be stressful and frustrating if you feel like you are drowning in debt with no relief in sight. Fortunately, the U.S. Bankruptcy law provides you with the tools to either get more time to pay your debts or to cancel them altogether. If you are suffering from these difficulties, we urge you to immediately contact a qualified Fort Collins bankruptcy lawyer.
The first step in a bankruptcy should be to set up a meeting with a qualified Fort Collins bankruptcy attorney. You should provide to your attorney a listing of all of your assets and liabilities. In other words, you should tell the attorney everything you own and everything you owe.
Gather the Documents Required for Bankruptcy-The attorney should ask for a list of documents related to your financial condition. For example, your last several years tax returns; 6 months worth of paystubs or evidence of income from whatever source; an appraisal for any property or real estate that you own; the names and addresses of your creditors with the approximate amount owed to each; statements from bank accounts, stock accounts or other investment accounts; statements on 401K, pension or retirement plans; spouse's paystubs or evidence of income; life insurance statements; and mortgage payment statements or car payment statements. These are a general listing of items that should be provided, but everyone's situation varies so more information may be needed depending on your situation.
Preparation of Bankruptcy Petition-Upon meeting with you and obtaining all of this information related to your finances, the attorney prepares a bankruptcy petition. Depending on your situation, you and your Fort Collins bankruptcy attorney may decide to file Chapter 7 or Chapter 13 Bankruptcy.
Filing of the Bankruptcy Petition -The filing of a bankruptcy petition is done electronically. The United States Bankruptcy Court, District of Colorado has a list of all forms that will need to be filled out by both you and your lawyer.
Meeting of Creditors- After the filing of the bankruptcy petition, a document from the court is sent out which is called "Notice of Commencement of Case. " This notice is sent out to all creditors to whom you owe money. The form contains the case number and the date, time, and place for the meeting of creditors. This meeting is the initial hearing in the bankruptcy case where the debtor and the attorney go and meet with the court-appointed trustee to review the petition and take testimony as to the accuracy of the petition and other financial issues related to the debtor's financial affairs.
Here is where the Chapter 7 Bankruptcy and Chapter 13 Bankruptcy processes diverge. If you filed Chapter 7 Bankruptcy, the final step is-
Obtaining Discharge Order- After the meeting of the creditors, creditors or the trustee are given time to file a complaint objecting to the bankruptcy. If no one does object within a set time frame, you would receive a discharge. The discharge is the final order entered by the court that wipes out the outstanding debt of the individual filing the bankruptcy.
If you filed Chapter 13 Bankruptcy, there are a few more steps involved-
Attend Confirmation Hearing- At your confirmation hearing, the judge assigned to your case will decide whether to confirm (approve) your Chapter 13 plan and allow your case to move forward. If there are no objections by either your trustee or your creditors, your case will be confirmed.
Make Your Court Mandated Chapter 13 Repayments- You’ll need to continue making your monthly plan payments for the next 3 to 5 years before your case successfully concludes and your discharge can be entered.
The final step if you’ve filed Chapter 13 bankruptcy in Fort Collins is-
Take a Debt Education Course- All people petitioning for debt forgiveness with the United States government must submit to credit counseling and debt education courses in order to have their debts discharged. For more information on these courses, visit the United States Court Website.
Of course, these steps have been greatly simplified and condensed for this website. For a more in-depth guide to the bankruptcy process, read the Department of Justice’s Bankruptcy Information Sheet, or contact one of our experienced Fort Collins bankruptcy attorneys. We understand that life is unpredictable. We recognize that filing for bankruptcy probably wasn’t in your plans when you started out, but you’re in it now and you need help.
Your Larimer County bankruptcy lawyer should be able to educate you on all the options, listen to you carefully so they understand your situation, and then be committed to ensuring that you know what is happening every step of the way. It is our goal to make sure that when you leave our offices you feel better than you did when you walked in. We know that filing for bankruptcy is disruptive and difficult, and we want to get you back on the path to financial stability as quickly as possible.
It’s unfortunate, but true, that many people who qualify for bankruptcy never avail themselves of its potential benefits- whether it’s because they’re afraid of the stigma, have been talked out of it by people around them, or any number of other reasons.
While it is true that a bankruptcy filing can affect your finances for years to come, for many people, filing is still the best option. To combat some of the pervasive disparagement surrounding bankruptcy, we’ve listed below some of the biggest benefits our clients have reaped when filing for bankruptcy in Larimer County.
Stops Creditor Harassment- If you’ve been struggling to make payments on loans, then you’re probably experiencing an increase in debt collection phone calls, emails, and letters. Immediately after filing bankruptcy, an injunction called an “automatic stay” is imposed to prevent creditor harassment. This injunction forbids those creditors from continuing any collection efforts. Creditors who attempt to collect debts after an automatic stay is imposed face strict consequences, so it’s important to hire an experienced Colorado bankruptcy lawyer who can help you if your creditors continue to contact you after you’ve filed for bankruptcy.
Halts Repossession- If you’ve financed a vehicle and are behind on a few payments, you may be facing repossession. As soon as you file for bankruptcy, any creditor who has a secured interest in your car and wants to repossess it can no longer do so. It’s important to note that filing for bankruptcy won’t erase all debt to a car loan provider- filing bankruptcy will allow you to hold onto your vehicle until you can negotiate or modify your agreement with the lender, which usually means getting caught up on payments, or you can negotiate the surrender of the vehicle at a later date so you have time to replace your vehicle or find other means of transportation.
Halts Home Foreclosure- Just like the above section on bankruptcy halting the repossession of your vehicle, an automatic stay will also stall home foreclosure proceedings. Typically, bankruptcy won’t eliminate your delinquent mortgage payments, but it will buy you time to either catch up on your payments or come to an understanding with the mortgage holder.
Stops Wage Garnishment- Wage garnishment occurs when a court issues an order that requires your employer to withhold a portion of your paycheck and send it directly to a person or entity to which you owe money. Some people facing wage garnishment look to bankruptcy to regain control of their finances. Filing for bankruptcy stops most wage garnishment and also prevents creditors from seeking new garnishment orders against you. However, you should be aware that bankruptcy will not stop the garnishment of child support or other non-dischargeable debts, including alimony or some student loans.
Stops Judgements or Lawsuits- Throughout the bankruptcy process, federal courts protect debtors from any legal action that creditors may try to impose. If a lender decides to file a lawsuit against you, then filing bankruptcy will immediately stop the lawsuit. The automatic stay makes it illegal for a lender to pursue a lawsuit and makes any judgment obtained after your bankruptcy filing void. However, it’s important to note that filing for bankruptcy will not stop any criminal charges against you.
Wipe-out all Predatory Loans- There are specific strategies lenders might use to trick you into accepting deals that could harm you, and it’s usually totally legal! When you’re in need of credit, it can be easy to fall victim to predatory lending scams. If you’ve watched television or listened to the radio, then you’ve probably heard ads promising things like “no down-payments” “no or low credit scores welcome” or “quick and easy payday loans.” If it sounds too good to be true, it probably is, but that’s small comfort when you’re desperate. Don’t be ashamed if you’ve fallen victim to predatory lenders, they often tailor their advertisements and services to the most vulnerable, such as people with little to no income, or people who have no credit. Since these predatory lenders generally use unsecured debt- meaning, they don’t require collateral, filing for Chapter 7 bankruptcy can eliminate almost all types of predatory loans. An experienced Fort Collins Chapter 7 bankruptcy attorney can help you figure out if your debts qualify for dischargement.
Erases Medical Debts- It’s important to note that, in the state of Colorado, you cannot file bankruptcy solely to discharge medical debt, you must include ALL of your debt. Filing “medical bankruptcy” is a common misconception that many people who are considering bankruptcy have. But if you have significant debt, including unpaid medical bills, a Fort Collins bankruptcy attorney can help you on the path toward easing that financial burden.
Prevent Loss of Utility Services- Services like electricity and water are a necessity. If you’re behind on utility bills and are in danger of having your services cut, filing for bankruptcy can give you the opportunity to halt a service interruption. Once again, it’s important to note that while bankruptcy may clear past utility debt- if you do not continue to make current or future payments, your utility services will be interrupted.