When Colorado residents are down on their luck, sometimes it can seem like they just cannot catch a break. This is particularly true when individuals are struggling with debt, as the bills may seem to stack on top of each other more and more each month.
In these instances, individuals may be interested in filing for Chapter 7 bankruptcy as a means of obtaining debt relief. In order to file for Chapter 7 bankruptcy, however, individuals must meet certain eligibility requirements. Fortunately, many individuals will have no trouble qualifying for Chapter 7.
For instance, one Colorado man recently filed for Chapter 7 after estimating he had between $50,000 and $100,000 in assets, compared to debts of between $10 million and $50 million. The man, a real estate developer, had previously been convicted of felony theft in relation to a real estate deal that took place several years ago. Even the man who had been on the other side of the theft wished the man the best, however, and hoped that the bankruptcy would help the man get his life straightened out.
Typically, in order to qualify for Chapter 7, individuals must meet certain income thresholds. The individual will have to satisfy a means test in order to determine if his or her income is too high to file for Chapter 7 or if the person can repay some debt.
While a criminal conviction will not necessarily bar a bankruptcy filing, there could be problems if the person has defrauded creditors, whether or not a criminal case exists. Moreover, individuals with prior bankruptcy discharges may be ineligible for another discharge, although the timing of the previous discharges will likely be at issue.
Ultimately, Chapter 7 will be an option for many individuals to gain a fresh footing on their financial life. By working with a bankruptcy attorney, individuals can ensure they meet the qualification criteria and that they have all the paperwork in order to file for Chapter 7.
Source: Daily Camera, "Boulder developer Mark Young files for bankruptcy," Alicia Wallace, Oct. 18, 2013