Now might just be the best time to file bankruptcy in Denver. Covid-19 has left millions of Americans out of work and has shut down several Colorado companies. If you were swimming in debt before the pandemic you are undoubtedly drowning in it now. And courts should be more understanding regarding debt during these trying times.
What Are Requirements for Filing Chapter 7 Bankruptcy in Colorado?
In 2019 94.3% of Chapter 7 filings had their debts discharged. You must pass a means test to qualify for Chapter 7 filing.
You may be wondering if you meet the requirements to file a Chapter 7 bankruptcy petition in the Denver area.
- Your debts must total more than half your annual income.
- It would take five years (or more) to pay off your debts.
- You have little to no disposable income.
- Your debt is interfering with other essential aspects of your life including relationships, anxiety and your ability to sleep.
- Your monthly income is below the median level in Colorado which is just over $77,000.
Yes, Salary Matters When You File Bankruptcy
Colorado looks at your last six months of salary to determine if you can file for Chapter 7 or Chapter 13 bankruptcy. Chapter 13 bankruptcy is for those with a higher salary. But it does require you pay back some of your debt. So Chapter 7 bankruptcy is what most bankruptcy filers prefer. If you lost your job your income has obviously dropped. Even if you are getting Colorado unemployment benefits. Lets say your salary before being laid off was $80,000 but now you are only getting $1,500 per month in unemployment. If you wait two months to file, your six-month average gross income will drop below a $77,000 average salary. Thus you will be eligibile for Chapter 7 bankruptcy in Colorado.
Barry Arrington Will Help Determine If It’s Time to File Bankruptcy
Barry Arrington is a top bankruptcy attorney serving the Denver area of Colorado, including Englewood, Lakewood, Centennial, Aurora and many other surrounding cities. He will give you a free consultation to see if now a good time to file bankruptcy.