Bankruptcy in Colorado is a legal procedure through which some of the debts of an individual or a business are discharged (excused). You should not view bankruptcy as an opportunity to eliminate your debts just because you don't feel like paying them - it can be a long and difficult process. Bankruptcy is designed to be a last resort to prevent complete financial ruin, while allowing creditors to collect at least some of their debts in an orderly fashion. Filing for bankruptcy can have major negative effects on one's credit score, which will make it more difficult to get loans in the future.
Accordingly, if you are considering bankruptcy as an option, you need to thoroughly examine the costs and benefits. A good Colorado bankruptcy attorney can advise you as to the pros and cons of bankruptcy, and give his or her expert opinion about whether or not bankruptcy is a good option, based on the facts of your distinct case.
Types of Bankruptcy in Colorado
Bankruptcy is governed by federal law, so the procedures in filing for bankruptcy in Colorado will be the same as anywhere else in the United States. There are 2 basic types of bankruptcy that consumers typically use: Chapter 7, and Chapter 13, owing their names to where they are found in the U.S. Bankruptcy Code. Additionally, there is a form of bankruptcy normally used by businesses called Chapter 11. Chapter 11 is available to individuals, but it is rarely the best option for them.
In Colorado, Chapter 7 bankruptcy is known as "liquidation." When a person files for Chapter 7 bankruptcy, a trustee is appointed by the bankruptcy court to do an accounting of the debtor's property. The trustee then decides what pieces of property, if any, should be sold off to pay off the debts. Many types of property are exempt from forced sale up to a certain dollar amount, including houses, cars, and retirement accounts. Once the property is sold, any remaining dischargeable debt is eliminated. Chapter 13 bankruptcy involves restructuring, rather than discharging, one's debt. Basically, the court structures a debt repayment plan meant to allow the debtor to pay off his or her debt in manageable installments, while allowing the debtors to eventually collect at least some of what is owed to them.
Chapter 11 bankruptcy, like Chapter 13, involves reorganization of debt. However, it is almost exclusively used by businesses, and not individuals. After filing for Chapter 11, the debtor has to come up with a repayment plan. The plan must then be approved by a majority vote of participating creditors.
How Can a Colorado Bankruptcy Lawyer Help?
Filing for bankruptcy is a very big decision, frought with risks. However, in some cases, the benefits might outweigh the costs. Because of this, it is important to seek the advice of a Colorado bankruptcy attorney, who can advise you of the likely consequences of filing, and whether or not doing so is likely to benefit you.
Interesting Facts About Colorado
Colorado is named after the multi-colored banks of the Colorado River. Its nickname is "The Centennial State", since it achieved statehood on the centennial year of the U.S. Declaration of Independence (1876). Former President Gerald Ford was from Colorado, as was U.S. Supreme Court Justice Byron R. White.
Colorado lawyers usually assist clients at the trial court level in either the County Court system or the District Court system. Appeals are heard at Colorado's Court of Appeals or at the Colorado Supreme Court. Colorado also has a unique system of 7 different Water Courts, which preside over cases involving water rights and water usage. The Colorado Supreme Court has tried many infamous cases such as Kobe Bryant's 2003 assault case in Eagle County.
Colorado is also known for its immensely complex body of tax laws. This is due to the fact that Colorado operates over 3,000 different districts, each with individual taxing authority. Such districts include regulation over education, water, transportation, and other services. In Colorado, the sales tax rates may be different even from street to street.
Lawyers in Colorado have experience in dealing with the state's network of laws. Colorado lawyers work to provide clients with outstanding services and legal advice. You may contact an attorney in Colorado if you need help filing a lawsuit or if you need answers to legal questions.