What is Bankruptcy in Colorado?
You have a question: “What is bankruptcy?” We want to inform you about your finances, so we’ll start with bankruptcy, as well as the types of bankruptcy (Chapter 7 and Chapter 13 bankruptcy) that our firm handles.
Bankruptcy: People or businesses struggling with financial burdens in Littleton, Centennial, or Aurora may want to consider bankruptcy. Bankruptcy gives them a new start on their finances because debts are canceled or restructured into a feasible payment plan.
What is the Difference Between Chapter 7 and Chapter 13 Bankruptcy in Aurora, Littleton, Centennial?
To answer the question: “What is bankruptcy?” we must also understand that bankruptcy is divided into different “chapters.” Depending on your situation, you may need to file a “liquidation” bankruptcy, called Chapter 7, or a “reorganization” bankruptcy, known as Chapter 13 in Centennial, Broomfield, or Englewood.
Chapter 7 Bankruptcy in Littleton, Colorado:
A Chapter 7 bankruptcy is known as a liquidation bankruptcy in Littleton, Colorado. In a Chapter 7 bankruptcy, debt will be “liquidated” or wiped out, and the bankruptcy trustee will sell any of your nonexempt property (property you can’t keep) to pay creditors. Chapter 7 bankruptcy will wipe out / discharge most unsecured debt, such as credit card debt or medical debt. However, some debts such as debts related to income taxes or some student loan debts, cannot be discharged.
Chapter 13 Bankruptcy in Aurora, Colorado:
In Aurora, a Chapter 13 bankruptcy is a reorganization bankruptcy, where a debtor makes monthly payments over a period of 3 to 5 years. The payment amount depends on the amount of the debtor’s “disposable income,” which is income left over after all of household essentials are taken care of, including food, clothing, transportation and housing. Chapter 13 bankruptcy is beneficial for those who wish to keep their property that could otherwise be foreclosed or repossessed in a Chapter 7 bankruptcy.