Denver Bankruptcy Attorney

A "means test" in a bankruptcy proceeding is one of the factors used to determine whether an individual debtor is eligible to file for bankruptcy under Chapter 7. The means test looks at the debtor's aggregate current monthly income (looked at over a number of years). If the net of that income, disregarding certain allowed expenses, is above the current income limit, then the debtor may not be eligible for filing under Chapter 7 unless he or she can prove special circumstances which would justify additional expenses or adjustments of current monthly income beyond those income/expense limits.

The most popular chapters for bankruptcy filings are Chapter 7 and Chapter 13. Every other chapter of the bankruptcy code has exclusions as to who may file so most persons who file for bankruptcy only qualify for Chapter 7 and Chapter 13. A liquidation of all debts is allowed under Chapter 7 and Chapter 13 order create payment plans over 3-5 years for existing debts.

Co-signers, spouses and other relatives may be affected by a bankruptcy filing. Co-signers may be forced to cover their guaranty, and any co-owned property may be subject to a bankruptcy order. If you jointly own property with a co-signer, spouse or other you may be forced to sell your interest in that property. Some states do allow for your primary home to be exempted from creditors and the bankruptcy court will follow that rule. If you do file for bankruptcy your credit report will reflect the filing for up to 10 years, therefore a co-signer or spouse may also have their credit adversely impacted by a bankruptcy filing.

A lawyer can stop creditor harassment. Once you file for bankruptcy all collection attempts by creditors must cease. A lawyer may also prevent a creditor from attempting illegal collection methods. Collection agencies are paid a percentage of what they collect, therefore the more they collect the more they get paid. Because the industry is based on this commission sometimes the only way you can stop creditor harassment is through legal action.

Filing for bankruptcy and your credit score are linked. When a person files for bankruptcy your credit report will reflect that filing for up to 10 years. To minimize the impact your credit score takes from a bankruptcy filing you should consult an attorney.

The bankruptcy code was created to provide debt relief to those who have run into financial difficulties and either need a fresh start or time to pay off their current debts. Debt relief is provided by the bankruptcy process but it does not come without strings. A bankruptcy filing will stay on your credit record for up to 10 years, as well, not all debts are eligible to be expunged through bankruptcy. You may be in need of debt relief but before you discard other options you should discuss with a bankruptcy attorney your specific debts.