Start with a Bankruptcy Attorney Who Understands the Current Legal Landscape
If you find yourself in overwhelming personal debt from credit cards, medical bills, and past-due mortgage payments, or your business is drowning in lease payments, merchant cash advances, and more, you may be wondering where to find relief.
You may have explored several options, including debt consolidation. However, you’ve discovered that debt consolidation in Denver or the state of Colorado is not the same as debt relief. Debt consolidation will give you a loan to pay off your credit cards, but still leaves you with debt. Also, because a consolidation loan will pay off your credit cards, this puts you in position to run up those balances again. If you have credit debt you can’t pay, the last thing you need is another loan that accrues interest and doesn’t get you out of debt or give you a fresh start. Debt consolidation leaves you on the hook, but what you want is freedom.
While you’d do anything to get out of debt, you’ve never truly considered bankruptcy because you’d always had a perception that it was “bad” for you. But, now, faced with your current position, you’re beginning to think that maybe that perception was wrong.
You’ve heard that in Chapter 7 bankruptcy or Chapter 13 bankruptcy will ruin your credit forever. But that is not true. It is a lie perpetuated by your creditors. In reality, you can have a 700+ credit score and be eligible for a mortgage 2 to 3 years after filing bankruptcy. For many, this is the fastest credit rehabilitation possible. This is possible because your credit starts to recover when you obtain a bankruptcy discharge. Bankruptcy is a fresh start for millions of people every year. That, for you, would be real relief.
What Happens When You File for Bankruptcy?
Whether you’re considering bankruptcy for yourself or a small business, the best bankruptcy attorneys in Denver will recommend that you view these filings as one-in-the-same. Most small businesses are personally liable for their business debt because loans, leases, MCAs, and more are often personally guaranteed. Your LLC does protect you from personally guaranteed business debt. If you’re struggling with personal debt or business debt, the solution is the same: get your debt discharged through bankruptcy and get a fresh start.
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Filing for personal bankruptcy: Depending on how much you earn, you can file for either Chapter 7 bankruptcy or Chapter 13 bankruptcy. Chapter 7 is reserved for those in Colorado whose income is at or below the state’s annual income threshold of $74,274 for a single person (through March 2024). This number varies depending on the number of people in your household and is adjusted twice per year (April and November).
If you work with a superior bankruptcy attorney to file for Chapter 7 bankruptcy, you can watch many of your debts, including medical bills and credit card debt, disappear completely. In Chapter 13 bankruptcy, those who earn over the income threshold enter into a three-to-five-year payment plan, after which your debts are discharged. The Chapter 13 payment plan is typically much more affordable than paying or even consolidating your debt.
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Those with small business debts: Your small business debts are likely personally guaranteed. What you can do to discharge these debts is to file for personal bankruptcy in the manner described above. If you want to keep your business going, you can restructure it as a sole proprietorship. In bankruptcy, you can keep up to $60,000 in business assets as part of what is called the “tools of the trade” exemption. If you dissolve your business, you can still keep up to this amount in business assets.
In Colorado, there are many protections on your side when you file for bankruptcy, whether your debts are personal or related to your small business. You just need an exceptional bankruptcy attorney to help.
SBA EIDL Loans and Bankruptcy
You might have even more complicated situations that require expertise to untangle. For example, you may be worried about what is going to happen with your Small Business Administration (SBA) Economic Injury Disaster Loan (EIDL) you received during the pandemic.
The SBA and federal lawmakers are still at odds on what should happen with these loans. It still isn’t clear whether all small businesses will be required to pay them. That’s why you need an attorney on your side that understands the changing circumstances related to SBA EIDL and can develop a smart legal strategy to protect you from creditors, discharge your debt, and put you in a better position financially for the future. Despite misinformation you may have heard, SBA loans including EIDLS are dischargeable in bankruptcy.
This isn’t something that a Denver debt consolidation company can do. In fact, this would be against their interests, as their goal is to continue to profit from your debt, even while convincing you that their option for debt relief is your best bet. This is not how help is supposed to work. When you file for bankruptcy with the right attorney, you get professional help that is meant to benefit you first. The attorneys at The Wink Law Firm are dedicated to getting you out of debt as cost-effectively as possible for you. With The Wink Law Firm, you can rest assured that you are getting out of debt as cheaply and quickly as possible under the law. We make the law work for you!
Now that You Know How It Works, Here’s How to File for Bankruptcy with an Attorney
In Colorado, the process for filing for Chapter 7 bankruptcy or Chapter 13 bankruptcy is simple. Follow these seven easy steps, and you’ll be on your way to relief from stress, worry, and debt.
- Hire a bankruptcy attorney that offers free consultations.
- Vet this attorney by reading their testimonials and reviews.
- You and your attorney will determine whether you qualify for Chapter 7 or 13 depending on your income.
- You will also work together to decide on the best option, if you own a small business, including restructuring your business and filing for personal bankruptcy to discharge your business debt.
- Your attorney will provide the most updated information and the strategic planning you need, if you still have an outstanding EIDL loan.
- You will also be asked to pull together personal or business documentation. Here’s a list.
- Your attorney will also provide the information you need to know about two courses that residents of Colorado must take during the bankruptcy process: a credit counseling course and a debtor education course.
Soon after you’ve fulfilled all your requirements and your bankruptcy attorney has finished their work on your behalf, you’ll receive notification of your successful bankruptcy.
Debt consolidation services can’t provide this kind of good news. In fact, you may end up being sued by a creditor, if the Denver debt consolidation company you work with pays off your creditors one at a time, leaving some of your creditors unsatisfied.
Bankruptcy is a highly impactful solution that can change your financial life. Learn more about the positive effect bankruptcy can have on your credit score in this article.