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Bankruptcy’s Automatic Stay

Bankruptcy Protection for Filers Under Chapter 7 or Chapter 13

A person struggling financially will likely consider working on a bankruptcy case to address his or her financial problems. Depending on the specific circumstance of the bankrupt individual, filing for bankruptcy can help stop repossession, foreclosure, and wage garnishment. This is where a knowledgeable and hands-on bankruptcy attorney in Broomfield can help.

In general, a bankruptcy filing could help the filer pay back lenders, wipe out certain debt, and financially have a fresh start at life. For this reason, declaring bankruptcy is generally considered a good debt-relief option. However, there are numerous bankruptcy types. Your goals, resources, and specific circumstances will come into play.

The Law Office of Clark Daniel Dray can assist with bankruptcy petitions, estate planning, and probate. Our Broomfield office is located west of Century Chevrolet and serves the residents of Broomfield, Westminster, Thornton, Northglenn, Brighton, and the surrounding area. Get in touch with our law firm to know how we can help.

Dealing with Debt and Deciding to Declare Bankruptcy

There are different types of bankruptcy, each with a set of advantages and disadvantages. A Chapter 7 liquidation, for example, is usually best for those dealing with credit card bills, medical bills, and personal loans. A Chapter 13 reorganization, on the other hand, is generally recommended for those with assets that they would want to keep.

When filing for bankruptcy, debts can be wiped out either after having certain assets liquidated or making payments following an approved debt-repayment plan. It is vital to keep in mind, however, that the specifics of bankruptcy rules could vary from court to court.

If you want to learn more about the types of bankruptcy apt for specific types of debt, or how to avail of automatic stay, consult with credible and hands-on Broomfield bankruptcy lawyers. Clark Dray takes a comprehensive approach to debt resolution and is prepared to assist you with Chapter 7 or 13 bankruptcies, ways to stop foreclosure or wage garnishment, debt settlement, and debt collection lawsuits.

Why Many Individuals are Filing Bankruptcy Cases

Filing bankruptcy is not a simple task. There are multiple steps involved, such as undergoing the required bankruptcy counseling, taking the means test, or preparing a debt repayment plan that will run for three or five years.

However, despite the lengthy and arduous legal process required by the bankruptcy court, a bankrupt individual can benefit a lot by filing Chapter 7 or 13. Being in serious debt is a big problem, and filing for bankruptcy may be the best way for you to rebuild your financial future.

If you are currently considering bankruptcy, it is best to consult with a seasoned local attorney who is knowledgeable with all federal and state laws that will come into play.

Seek legal advice from competent and compassionate bankruptcy attorneys in Colorado. Talk to someone who can answer your legal questions on liquidation and reorganization bankruptcy.

Whether it’s bankruptcy or other legal matters, the Law Office of  Clark Daniel Dray is here to help. Call (303) 493 9908 to schedule your free consultation with an experienced Broomfield bankruptcy attorney.

Quick Overview of Bankruptcy and Automatic Stay

The automatic stay generally allows a debtor to experience a reprieve from the stress of being sued, garnished, levied upon, having a bank account frozen, or otherwise harassed by lenders and collectors.

In particular, it is beneficial in preventing creditors from taking the following actions:

  • Perfecting a lien against secured property or demanding collateral to secure an existing debt
  • Continuing to litigate a claim arising before the bankruptcy petition was filed, or filing a new lawsuit after the filing
  • Mailing any letters, calling or initiating any in-person contact at all to collect a debt
  • Foreclosing on a home or repossessing a vehicle or other personal property absent a signed court order granting Relief from Stay

Additionally, a creditor is also required to take reasonable steps to halt already commenced collection efforts, such as stopping an impending foreclosure sale or wage garnishment. However, the automatic stay does not prohibit creditors from collecting on the following debts:

  • Eviction actions by landlord with a possession judgment for residential real estate
  • IRS or Colorado Department of Revenue tax audits
  • Criminal prosecutions
  • Attempts to establish paternity or enforce an existing child support or spousal maintenance order

The Law Office of Clark Daniel Dray will provide the personalized service and attention to detail that are essential to a successful bankruptcy declaration.

How a Bankruptcy Attorney Can Help You Maximize Automatic Stay

The automatic stay provisions are often less generous for those having already filed for bankruptcy. This is especially for those filed within one year or less prior to the current filing. However, there are circumstances in which a special motion can be filed requesting the standard collection prohibitions.

The automatic stay provisions of Section 362 of the Bankruptcy Code can stop most creditors from engaging in any collection activity against a debtor (or the debtor’s property) once a petition in Colorado is filed.

While the process of filing bankruptcy is short and straightforward, bankruptcy laws are complex, nuanced, and constantly changing. As such, it is vital to choose a local attorney who is dedicated to making sure that you get the best results possible.

An experienced and reliable Broomfiled bankruptcy lawyer can request that the Automatic Stay immediately arise without the need for a prior hearing in Colorado Bankruptcy Court. 

Overview of Filing Bankruptcy Under Chapter 7

There are different types of bankruptcy, and choosing the best option will depend on specific circumstances. When filing for bankruptcy under Chapter 7, debts can be wiped out after having certain assets liquidated by a trustee in bankruptcy.

While deciding if liquidation bankruptcy is suited for you, your specific financial problems will factor in. If your unsecured debts are generally dischargeable and you do not have a lot of assets, then a Chapter 7 bankruptcy declaration is possibly the best choice. This is in contrast to financial problems that are made up of mostly non-dischargeable debts, where reorganization would likely be a better option.

As mentioned above, a discharge notice from the court will stop creditor or debt collector harassment and even wage garnishment. An experienced bankruptcy lawyer in Broomsfield, Colorado can further explain the specifics of a Chapter 7 bankruptcy petition.

Overview of a Chapter 13 Petition in Bankruptcy

Declaring bankruptcy under Chapter 13 will generally allow you to restructure and reorganize your finances. Here, making payments for debts owed is made possible through a debt-repayment plan approved by the bankruptcy court. This would take three or five years.

In general, a Chapter 13 bankruptcy petition will take longer than other forms of consumer bankruptcy. However, filing for bankruptcy and proceeding with restructuring will allow a filer to bring current most monthly payments for secured loans without giving up property.

If you are considering bankruptcy, you will need to discuss your debt reorganization plans with a qualified credit counselor. Additionally, it is very important to first meet with a reliable bankruptcy attorney. Experienced Colorado bankruptcy attorneys can assist you with the forms and supporting documents that must be filled out and submitted to court.

Considering Your Secured and Unsecured Debts

From the name itself, secured debts are secured by a collateral. You must pay off what you owe if you intend to keep the said collateral, which could include your car.

Conversely, a person who files for bankruptcy under Chapter 7 will often have his or her unsecured debt discharged. For Chapter 13, your remaining nonpriority unsecured debt balances will be forgiven after you complete your payment plan.

Under relevant bankruptcy laws, unsecured debts could include unpaid medical bills, credit card bills, and utility payments.

However, while personal loans and some forms of tax debt are unsecured, they may not always be included in the discharge. The same can be said for student loans that must still be paid off, even after declaring bankruptcy. A student loan may only be discharged if you can prove in an adversary proceeding that it will be an undue hardship to pay back the debt.

Regardless of the circumstance, alimony or child support owed, criminal fines or penalties, and specific tax debt are generally not dischargeable, despite being ‘unsecured’.

Bankruptcy Laws and Avoiding Creditor Harassment

Under the bankruptcy code, a person who is able to declare bankruptcy could possibly discharge debts that he or she owes from certain lenders. Essentially, you no longer have to worry about paying off creditors of loans that were wiped out.  If a declaration of bankruptcy leads to a bankruptcy discharge, debt collectors are no longer allowed to ask for repayment for what the debtor owed them.

A person who filed for bankruptcy under Chapter 7 would likely receive a court order on the bankruptcy discharge after non-exempt assets have been sold and priority debts have been paid. On the other hand, under Chapter 13, you will receive a discharge order that will wipe out the remaining balance of all qualifying debts only after you complete your debt repayment plan.

A discharge notice from the bankruptcy court will be sent to your trustee and your unpaid creditors. This will enable you to stop creditor or debt collector harassment even without the automatic stay.

To a certain extent, a Chapter 13 bankruptcy discharge is broader than that of Chapter 7 because it wipes out certain debts that are not covered by the latter. The period of time involved, however, can be a crucial factor to consider.

Knowing When It’s Best and How to File for Bankruptcy

A person struggling financially will likely consider bankruptcy to address his or her financial problems. In general, a bankruptcy filing could help the filer pay back lenders, wipe out certain types of debt, and financially have a fresh start in life. For this reason, declaring bankruptcy is generally considered a good debt-relief option.

Forgiven or discharged debt is usually associated with a Chapter 7 petition for bankruptcy. Unknown to many, certain debts are also dischargeable through a Chapter 13 bankruptcy petition. However, following the bankruptcy code, a bankrupt individual would have to wait longer because one must first make all monthly payments that were included in the debt payment plan. As such, the process would likely be finished in three or five years, in contrast to just a few months.

Deciding to File for Bankruptcy and Choosing the Best Type

For many people, a bankruptcy petition is the window of opportunity that will allow them to deal best with creditors and debts. Successful bankruptcy proceedings have helped so many individuals dealing with debt.

When choosing between the two common bankruptcy types mentioned above, your specific financial problems will factor in. If your debts are generally dischargeable, then a Chapter 7 will likely be best. In contrast, if you need to deal with mostly non-dischargeable debts, a bankruptcy Chapter 13 debt repayment plan may be a better option.

There are other factors that must be considered, however. One would be the ability to meet certain bankruptcy qualifications, such as passing the means test or having the minimum required monthly income. Others would be the type of properties that you have, whether or not a joint filing will be made, or the list of exempt assets in your state.

Get in touch with a competent and compassionate bankruptcy attorney in Broomfield, CO to know your options.

Contact us at our Colorado Law Office Today!

If you are presently considering bankruptcy, it is best to consult with a trusted local attorney who is knowledgeable with all federal and state laws that must be taken into account.

Filing bankruptcy requires a bankrupt individual to go through a serious legal process. This generally begins with bankruptcy counseling and taking the means test. Proceedings in the bankruptcy court are not as simple as they may seem, and crucial mistakes must be avoided at all costs.

Talk to our bankruptcy law firm in Colorado and get legal advice from a seasoned local attorney. Contact our Broomfield bankruptcy attorneys at The Law Office of Clark Daniel Dray. We are located on the north side of 120th Avenue, immediately to the west of Century Chevrolet.

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