An unsecured debt in bankruptcy in Littleton and everywhere else in Colorado is a debt that is not secured by any property serving as collateral. In other words, if you fail to pay the debt, a creditor cannot foreclose on a lien. Debt collectors would have to try to sue you or file a lawsuit against you if they wished to take your property. In most cases, the majority of debt is unsecured. Some common types of unsecured debt in Colorado include back rent, student loans, personal loans from friends, credit card debt (except some store credit cards), medical bills, court ordered child support and alimony, health club dues, and lawyers’ or accountant’s bills.
Unsecured Debt in Bankruptcy in Aurora | How Unsecured Debt is Treated in Chapter 7
In Aurora and across Colorado, a Chapter 7 bankruptcy will wipe out most kinds of unsecured debt. Some of the most common types of dischargeable unsecured debt in a Chapter 7 bankruptcy include medical bills or credit card debt. Common nondischargeable debts (debts which cannot be wiped out) in Colorado include child support debt, student loans, some tax debts, or debts that were incurred as a result of fraud.
Chapter 13 Bankruptcy Unsecured Debt in Centennial, Colorado
In a Chapter 13 bankruptcy in Centennial and every other part of Colorado, how your unsecured debt is handled depends on whether the unsecured debt is a priority debt or not. If you have priority unsecured debts, they must be paid first in your Chapter 13 plan. These may include taxes or domestic support obligations. Nonpriority unsecured debt, can typically be discharged in your bankruptcy. Common nonpriority, unsecured debts may include medical bills, personal loans or credit card debt. The monthly amount you must devote to you plan depends on the amount of “disposable income.” Disposable income is calculated pursuant to a very complex formula, and that is why it is almost always necessary to hire an attorney to help you with a Chapter 13.
Bankruptcy Attorney for Unsecured Debt in Parker, Colorado: Call Barry Today
If you have more questions about unsecured debt and how it will be treated in a Chapter 7 or Chapter 13 bankruptcy in Parker or any other area in Colorado, contact bankruptcy lawyer Barry Arrington right away. It is imperative that you know which of your debts are unsecured so you know which ones will be discharged and how they will affect your Chapter 7 or Chapter 13 bankruptcy. Call Barry today to set up a free initial consultation to discuss unsecured debt in a Chapter 7 or Chapter 13 bankruptcy in greater detail.