Filing for bankruptcy can be a daunting decision for anyone. However, if you are struggling with overwhelming debt, it may be the best option for you. In Colorado, there are two primary types of bankruptcy: Chapter 7 and Chapter 13. Each type has its own set of rules regarding what assets can be kept and which debts can be discharged. In this blog post, we'll take a closer look at three common questions that many people have when considering filing for bankruptcy: Can I keep my home and car in Chapter 13 bankruptcy? What assets are exempt in Chapter 7 bankruptcy? And finally, what debts get discharged when I file for Chapter 13 bankruptcy?

1) Can I keep my home and car in Chapter 13 bankruptcy?

Chapter 13 bankruptcy is often referred to as reorganization or repayment plan bankruptcy. This means that instead of liquidating your assets to repay creditors like in Chapter 7, you create a payment plan over three to five years to pay off your debts. So, can you keep your home and car in this type of bankruptcy? The answer is generally yes! As long as you continue making payments on these assets through your repayment plan, you should be able to keep them.

2) What assets are exempt in Chapter 7 bankruptcy?

Chapter 7 is often referred to as liquidation bankruptcy because some of your assets may need to be sold off to pay back creditors. However, certain types of property are considered exempt under Colorado law. This means that they cannot be taken from you by the court or sold off during the bankruptcy process. Some examples of exempt property include:

• Your primary residence up to $75,000 in equity
• A vehicle up to $7,500 equity
• Personal property such as clothing and household goods
• Retirement accounts such as 401(k) or IRAs

It's important to note that these exemption amounts are subject to change, so it's always best to consult with a bankruptcy attorney for the most up-to-date information.

3) What debts get discharged when I file for Chapter 13 bankruptcy?

Chapter 13 bankruptcy can be a great option for those who want to keep their assets but still need debt relief. In this type of bankruptcy, certain debts can be discharged at the end of your repayment plan. These may include:

• Credit card debt
• Medical bills
• Personal loans
• Past-due utility bills
• Some tax debts

However, it's important to note that not all debts are dischargeable in Chapter 13 bankruptcy. For example, student loan debt is generally not dischargeable unless you can prove undue hardship.

4) How do I know if bankruptcy is right for me?

Deciding whether or not to file for bankruptcy is a big decision and should not be taken lightly. It's essential to speak with an experienced bankruptcy attorney who can evaluate your individual circumstances and help you make an informed decision. They can also guide you through the process and ensure that everything is done correctly.

Filing for bankruptcy can be a complex and emotional process, but it doesn't have to be scary. Understanding what assets you can keep, what debts may be discharged, and how each type of bankruptcy works is essential. If you're considering filing for bankruptcy in Colorado, it's important to seek out the advice of an experienced attorney who can answer your questions and help guide you through the process.