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Bankruptcy FAQs

Bankruptcy FAQ’s:

  1.  That it is simply a set of laws that gives a person many wonderful rights.
  1. That, like you, no one sets out wanting to do a bankruptcy.
  1. That many people are able to get high credit scores 2 to 3 years after filing a bankruptcy.
  1. That in MOST bankruptcies, the creditors GET NOTHING. It is simply not true that a Chapter 13 always means that you pay back your creditors.  ZERO is often the case.
  1. That there is almost ALWAYS A BANKRUPTCY that you can do, EVEN IF YOU JUST DID ONE. Whether that is a Chapter 7, a full Chapter 13, or a partial Chapter 13, you CAN get relief. Why be garnished?
  1. That after bankruptcy you can pay back anyone you want. Do we want you to? NO. But if you ever want to and have the ability to do so, you certainly can; on your terms, without harassment from anyone. After you file bankruptcy your creditors cannot call you, write you, sue you, garnish wages, garnish bank accounts, lien your property, nothing. It is against federal law. 
  1. The payments in a Chapter 13 many times are lower than $90 per month, depending on what you need to do in a bankruptcy. COMPARE that to ONE FOURTH of your WAGES in a garnishment. I see no reason why anyone in this country needs to be garnished. There may be situations that I am not aware of, maybe taxes, maybe child support and maybe something else, but you need to see what bankruptcy can do. 
  1. That TAXES can be dealt with in a bankruptcy. Some of them may go away. Others usually are stretched out over 5 years. 
  1. That sometimes a SECOND MORTGAGE can be WIPED OUT. And when that happens it is AMAZING.
  1. That when you are UPSIDE DOWN on a vehicle, sometimes your bankruptcy can lower what you pay so that you ONLY PAY the ACTUAL VALUE, not the whole loan. AND when that happens you STRETCH THAT AMOUNT over FIVE YEARS. It is called CRAMMING and it is another of the wonderful rights allowed by bankruptcy in some circumstances.
  1.  That when your vehicle can be CRAMMED, sometimes your total bankruptcy payment comes out to be LESS than your previous vehicle payment. 
  1. That Chapter 13 gives you FIVE years to CATCH UP your house payments. 
  1. That Chapter 13 gives you time to not only stop a foreclosure but time to modify your loan. We always encourage our clients to keep pursuing MODIFICATION with their mortgage company, even during the bankruptcy. If granted we can always change what we are doing. 
  1. That Bankruptcy is like politics and making sausage. You just want to know that the end product will help you, not the details of what all goes into it. Your life details will change daily and our job is to make the bankruptcy law bend and flex to meet your ever changing needs. People lose jobs, people decide to give back a home, people leave the planet; we work with you to meet your life changes, with always your needs in our hearts and a smile on our faces. Humor makes the world go round  and everyone can laugh at the same time that we do the serious work of making this law make your life better. It is what it is.  
  1. That once you have decided on the details (keep the home or not, keep the car or stuff it in the face of the creditor, etc., etc.) there is always only one for you, Chapter 7 or Chapter 13. WE ALWAYS think about a Chapter 7 first as it is the quickest and cheapest, wham bam thank you mam, IF it is the best for your situation.
  1. That after looking at the details of YOUR situation, that we find that you do not qualify for a Chapter 7, or that a Chapter 13 can do something wonderful for you, then we go that way. In our office you certainly are in the mix during the whole process. and YOU make the final decision. Our job is to make your decisions happen. 
  1. That as things change over the years in your life, that your bankruptcy can be CHANGED, whether that is to lower a payment, to convert from one to the other bankruptcy, or whatever it takes to make your bankruptcy fit your situation. 
  1. That sometimes dismissal of your bankruptcy and refiling due to changed circumstances to benefit you is the best option. 
  1. That you do not have to be wakened by your creditors in the morning and put to bed by them at night. Retain us and hang up on them. File bankruptcy and make them STOP FOREVER. You either can pay the money or you cannot. Where does it say that you have to take the abuse of hired guns harassing you for debt that you cannot pay? 
  1. That I have been doing this work for more than 30 years and I am more passionate now than I ever have been about what this law can do for people. 

We enjoy what we do because Bankruptcy law allows us to make a living helping people through our knowledge of this wonderful law. Lives change for the better right before our eyes. What could be better

 

What Is Bankruptcy?

Bankruptcy is a set of federal laws and rules that can help individuals and businesses who owe more debt than they can pay. In bankruptcy, the person, corporation, or partnership that owes money is called the debtor. Bankruptcy permits the debtor to work out a plan to repay some or all of the debt, to liquidate assets, or to have some of the debt forgiven (“discharged”) in an effort to obtain a “fresh start”. The bankruptcy laws give the debtor protection and benefits not available outside of bankruptcy, such as requiring that creditors stop all collection efforts while the debtor is in bankruptcy, unless otherwise ordered by the Bankruptcy Court. In bankruptcy, a debtor must make full disclosure of all assets, liabilities, and other financial information, and must either (1) surrender non-exempt (protected) property for liquidation and distribution to creditors, or (2) formulate a plan providing creditors at least as much as they would receive if the assets were liquidated.

The Bankruptcy Code is a federal law, Title 11 of the United States Code. It provides help for individuals and businesses in financial difficulty while at the same time dealing with their creditors evenhandedly. The Bankruptcy Code is divided into several chapters. Chapters 7, 11, and 13 are the most commonly used. Each of these chapters offers debtors a different set of options for dealing with debt. At the Cross Law Firm we help debtors file under Chapters 7 & 13 of the Bankruptcy Code.

 

WHAT EVERYONE OUGHT TO KNOW ABOUT BANKRUPTCY:

  1. That it is simply a set of laws that gives a person many wonderful rights.
  1. That, like you, no one sets out wanting to do a bankruptcy.
  1. That many people are able to get high credit scores 2 to 3 years after filing a bankruptcy.
  1. That in MOST bankruptcies, the creditors GET NOTHING. It is simply not true that a Chapter 13 always means that you pay back your creditors.  ZERO is often the case.
  1. That there is almost ALWAYS A BANKRUPTCY that you can do, EVEN IF YOU JUST DID ONE. Whether that is a Chapter 7, a full Chapter 13, or a partial Chapter 13, you CAN get relief. Why be garnished?
  1. That after bankruptcy you can pay back anyone you want. Do we want you to? NO. But if you ever want to and have the ability to do so, you certainly can; on your terms, without harassment from anyone. After you file bankruptcy your creditors cannot call you, write you, sue you, garnish wages, garnish bank accounts, lien your property, nothing. It is against federal law. 
  1. The payments in a Chapter 13 many times are lower than $90 per month, depending on what you need to do in a bankruptcy. COMPARE that to ONE FOURTH of your WAGES in a garnishment. I see no reason why anyone in this country needs to be garnished. There may be situations that I am not aware of, maybe taxes, maybe child support and maybe something else, but you need to see what bankruptcy can do. 
  1. That TAXES can be dealt with in a bankruptcy. Some of them may go away. Others usually are stretched out over 5 years. 
  1. That sometimes a SECOND MORTGAGE can be WIPED OUT. And when that happens it is AMAZING.
  1. That when you are UPSIDE DOWN on a vehicle, sometimes your bankruptcy can lower what you pay so that you ONLY PAY the ACTUAL VALUE, not the whole loan. AND when that happens you STRETCH THAT AMOUNT over FIVE YEARS. It is called CRAMMING and it is another of the wonderful rights allowed by bankruptcy in some circumstances.
  1.  That when your vehicle can be CRAMMED, sometimes your total bankruptcy payment comes out to be LESS than your previous vehicle payment. 
  1. That Chapter 13 gives you FIVE years to CATCH UP your house payments. 
  1. That Chapter 13 gives you time to not only stop a foreclosure but time to modify your loan. We always encourage our clients to keep pursuing MODIFICATION with their mortgage company, even during the bankruptcy. If granted we can always change what we are doing. 
  1. That Bankruptcy is like politics and making sausage. You just want to know that the end product will help you, not the details of what all goes into it. Your life details will change daily and our job is to make the bankruptcy law bend and flex to meet your ever changing needs. People lose jobs, people decide to give back a home, people leave the planet; we work with you to meet your life changes, with always your needs in our hearts and a smile on our faces. Humor makes the world go round  and everyone can laugh at the same time that we do the serious work of making this law make your life better. It is what it is.  
  1. That once you have decided on the details (keep the home or not, keep the car or stuff it in the face of the creditor, etc., etc.) there is always only one for you, Chapter 7 or Chapter 13. WE ALWAYS think about a Chapter 7 first as it is the quickest and cheapest, wham bam thank you mam, IF it is the best for your situation.
  1. That after looking at the details of YOUR situation, that we find that you do not qualify for a Chapter 7, or that a Chapter 13 can do something wonderful for you, then we go that way. In our office you certainly are in the mix during the whole process. and YOU make the final decision. Our job is to make your decisions happen. 
  1. That as things change over the years in your life, that your bankruptcy can be CHANGED, whether that is to lower a payment, to convert from one to the other bankruptcy, or whatever it takes to make your bankruptcy fit your situation. 
  1. That sometimes dismissal of your bankruptcy and refiling due to changed circumstances to benefit you is the best option. 
  1. That you do not have to be wakened by your creditors in the morning and put to bed by them at night. Retain us and hang up on them. File bankruptcy and make them STOP FOREVER. You either can pay the money or you cannot. Where does it say that you have to take the abuse of hired guns harassing you for debt that you cannot pay? 
  1. That I have been doing this work for more than 30 years and I am more passionate now than I ever have been about what this law can do for people. 

We enjoy what we do because Bankruptcy law allows us to make a living helping people through our knowledge of this wonderful law. Lives change for the better right before our eyes. What could be better? 

 

What About My Credit?

 

There are two ways that I know of to improve your credit:

  1. Simply pay your debt…OR,
  1. File bankruptcy.

 

Yes- bankruptcy will affect your credit. So will sitting there unable to pay your debt.

Yes- once your bankruptcy is over, you can start building up your credit. It is a start.

No- choosing not to file bankruptcy and missing more payments does not help build your credit. That is not a start of anything.

BANKRUPTCY means a fresh start.

Not filing bankruptcy may mean that you are just putting up with your situation for that much longer. What good is that?

The good news is that you do not have to jump off a roof to get rid of your debt and to improve your credit.

 

Will I Have To Attend Court?

 

You will never see a court in your bankruptcy in most cases. Bankruptcy in Colorado usually requires a meeting with you, your attorney and a bankruptcy trustee. The trustee’s job is to find assets. You need an attorney because preplanning can prevent loss of assets. There are lots of reasons that you need an attorney but this is the most costly one. A Colorado attorney can keep you from losing assets and having the bankruptcy become a whole lot more expensive than you were planning. Do not ever do your own root canal and do not ever remove a tumor from your body without a professional doing damage control. Our firm can help you avoid the basic, the more subtle, and the GREAT BIG mistakes that can change your life. All of the rules are not written down. We did a recent google search and came up with several respectable looking websites. They all had different homestead exemption information. One said Colorado’s exemption is $20,000, one said $50.000, one said $60,000, and one said $80,000. The truth is that if you said 60,000 you were half right. It is $60,000 if you are under 60 years old and if you are not disabled. If you are disabled and/or at least 60 years old, the exemption is $90,000. So, if you had thought it was $80,000 and you had that much equity in your house, you would have had a good chance of losing $20,000 upon filing. And you are saving how much when you file without an attorney?

Our firm takes as much of the mystery and fear out of bankruptcy as is possible. We have seen a lot of things in the thousands of bankruptcies that we have done, and we still see new things. It is our job to use what we have learned to your advantage. And we do it with a smile. Our mission is to make this painless, to give you the biggest bang for your buck, and to make it a little bit of fun or hopefully a lot of fun. If you want someone to beat on you morally, you need some other attorney. We do not think that you are wrong for doing bankruptcy. Many times the filing of a bankruptcy is VERY RIGHT.

The hearing is usually 25 to 40 days after you file your bankruptcy. In Pueblo, it is usually held in the Marriott Convention Center. You use exit 98B off of Highway 25 to get there. In Colorado Springs, where the hearings are held for El Paso County and Teller County, 341’s for 7’s are located on North Wahsatch, just south of Platte Avenue, beside the Wendy’s and across the street from McDonald’s. Park in the covered parking part of the building which is the North Part, nearest Wendy’s. The setting for hearings for 13’s are in flux, but we will let you know where to go.

The hearings for Colorado bankruptcies are held in centralized cities. Your address determines the city in which your hearing is held. El Paso County and Teller County both go to Colorado Springs. South and East of El Paso County you generally go to Pueblo County for your bankruptcy. Park County goes to Denver however. Southwestern and western counties go to Grand Junction for their hearings. Northern Counties go to Fort Collins and the rest of the counties generally go to Denver, in the belly of the beast at 20th and Stout, where the large federal buildings are located.

You may see a court if problems develop or an issue needs to be decided. Hopefully your attorney has assessed this long before and talked it over with you and thus you are prepared for that eventuality.  

 

YES! SOME TAXES MAY GO AWAY IN BANKRUPTCY

 

​If you filed your taxes several years ago and owed money at that time but could not pay them, yes it is possible that they will go away in the bankruptcy. We always refer you to a tax specialist  but as your attorney we can give you what we know and that may be exciting news.

Bankruptcy FAQs