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We
will pull your FREE CREDIT REPORT to analyze your situation.
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bankruptcy advice to the
entire south Denver Metropolitan area, including Littleton, Englewood,
Centennial & Aurora in Arapahoe County, Highlands Ranch and Castle Rock in
Douglas County, Denver and south Jefferson County, Colorado CO
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Frequently Asked Questions about Chapter 7
(Note: the following questions and answers provide generalized comment
on Bankruptcy law and procedure in Colorado and may not apply in all fact
situations. They are not a substitute for consultation with an experienced
attorney.)
TABLE OF CONTENTS
4.
What kinds
of debts are not discharged in Chapter 7?
5.
Will I have to repay the bills if I earn a lot of money after I file?
6.
What happens to secured loans such as a car financed by a finance company, bank
or other creditor?
7.
Are there any time limits on debts that I want to have discharged?
8.
How
soon after a prior bankruptcy can I file Chapter 7 again?
Chapter 7 Bankruptcy, known as
"Liquidation", allows you to have the court
"discharge" or cancel most of your debts in order to obtain a fresh
start. State exemptions protect some or all of your property. If you
file your case with substantial non-exempt property, the trustee can sell ("liquidate") this property and spread the money amongst your creditors
according to certain priorities. Experienced legal counsel can advise you
how best to take advantage of your property exemptions to maximize the benefit
of the Chapter 7.
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2. Am I allowed to file Chapter 7 Bankruptcy?
Before the new law came into effect, it was generally up to you as to whether you wish to
file a Chapter 7. You do not need to be insolvent (Debts exceeding
Assets). A case could be filed to allow the court to sell your non-exempt
assets to pay your creditors while stopping all of the legal actions against
you.
However, in a Chapter 7 you will file a budget that shows your monthly income
and outgo. If it appears that after discharging your debts, you
have substantial excess income left at the end of every month, you will be
required to file a Chapter 13 repayment plan.
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Generally, most unsecured debts are discharged such as:
 | Credit cards and store charges. |
| Medical bills, including hospital and doctor fees. |
| Rent, telephone and utility charges that are in arrears. |
| Bank, credit union, finance company & signature loans. |
| Veterans' assistance loans. |
| Attorney and court fees. |
| Overdrafts on bank accounts. |
| Mail order, record or book
club bills. |
| Storage and rental fees. |
| Most debts owed due to a car accident. |
| Most business debts. |
| Obligations as a co-signer |
| Deficiency balances on repossessions |
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Generally, the following types of debts are not
dischargeable:
| Domestic Support (Child support and maintenance) type payments. |
| Other Dissolution
of Marriage obligations. |
| Auto collision injury damages if incurred while
legally intoxicated. |
| Recent taxes (approximately last 3
years) and loans used to pay such tax. Tax Dischargeability analysis
is difficult, and the only way to correctly determine if
taxes are dischargeable in your case is to obtain an
official "literal" tax transcript (record of account) from
the taxing agency and have it analyzed by a bankruptcy
attorney or tax professional with experience in this area.
This transcript can be obtained from the Internal Revenue
Service by calling 1-866-860-4259 |
| Fines, Restitution and
Penalties. |
| Student loans, unless you can prove
extreme, undue hardship. |
| Willfully caused injuries. |
| Fraudulently obtained credit or property. |
| Pension Plan
Loans. |
| Post bankruptcy
Condo Dues until Condo disposed of. |
| Debt for last
minute cash advances and luxury purchases. |
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No. If you are allowed to file a Chapter 7, the
court cannot order you to pay bills out of future income, wages, commissions or
profits that you may receive.
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You will be able to keep the car or other property as long as you continue to
make the monthly payments on time and sign a reaffirmation agreement; or you
redeem the item by paying its value to the creditor.
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It does not matter if a debt is very old. Very recent
debts are another story. There is a presumption that you knew you were
going to file bankruptcy upon debt incurred with a single creditor on luxury item purchases
over $500 within 90 days or or cash
advances of more than $750 within 70
days of filing. In such instances, the creditor could successfully contest
the discharge of that part of your debt.
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Eight (8) years from the date you filed a prior Chapter 7 bankruptcy. If
you received a discharge in a completed Chapter 13, you will have to wait 6
years to file a new Chapter 7.
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Generally, it is quicker and less expensive than a Chapter
13. You would discharge most of your debts, and be able to start again
without a difficult budget. As the discharge occurs within about five
months, you begin building your new credit history sooner. Generally, if
we are able to solve your pressing problems, directly or indirectly using a
Chapter 7, it leads to a quicker "fresh start" of your financial life.
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PLEASE FEEL FREE TO CONTACT US FOR
FURTHER EXPLANATION OR INFORMATION REGARDING THE SPECIFICS OF YOUR
SITUATION.
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