{"id":2458975,"date":"2020-05-29T08:00:00","date_gmt":"2020-05-29T14:00:00","guid":{"rendered":"https:\/\/www.aspentimes.com\/?p=326578"},"modified":"2020-05-29T08:00:00","modified_gmt":"2020-05-29T14:00:00","slug":"8-things-everyone-should-know-about-filing-for-bankruptcy","status":"publish","type":"post","link":"https:\/\/alwaysmountaintime.com\/kspn\/local-news\/8-things-everyone-should-know-about-filing-for-bankruptcy\/","title":{"rendered":"8 things everyone should know about filing for bankruptcy"},"content":{"rendered":"<p class=\"has-text-align-center\"><strong><em>Editor\u2019s Note: Sponsored content brought to you by Diana A. Ray, Attorney at Law<\/em><\/strong><\/p>\n<div class=\"p402_hide\">\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large\">\n<p><img decoding=\"async\" src=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/GettyImages-New-growth-1024x683.jpg\" alt class=\"wp-image-326579\" srcset=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/GettyImages-New-growth-1024x683.jpg 1024w, https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/GettyImages-New-growth-300x200.jpg 300w, https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/GettyImages-New-growth-768x512.jpg 768w, https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/GettyImages-New-growth-1536x1024.jpg 1536w, https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/GettyImages-New-growth-2048x1365.jpg 2048w\" sizes=\"(max-width: 1024px) 100vw, 1024px\"><\/p><figcaption><strong><em>Bankruptcy is a fresh start for people who are unable to pay down their debts (see factbox). Bankruptcy gets rid of dischargeable debt, completely free and clear, and it\u2019s tax free.<\/em><\/strong><br \/><em>Getty Images<\/em><\/figcaption><\/figure>\n<\/div>\n<\/div>\n<p>When people fall on hard financial times, there\u2019s one opportunity that creates a fresh start: bankruptcy.<\/p>\n<p>The most responsible people in the world can still end up in a hard financial situation, said Diana A. Ray, a bankruptcy attorney in Glenwood Springs. And now, given the coronavirus pandemic and its effects on the economy, more and more people are finding themselves in scary and uncertain situations.<\/p>\n<p>\u201cI want people to know that bankruptcy is not a bad thing \u2014 it\u2019s a right that we all have,\u201d Ray said.<\/p>\n<div class=\"row\">\n<div class=\"col\" readability=\"6\">\n<div class=\"row at-donation at-donation-mobile p-0\" readability=\"7\">\n<div class=\"col-xl-4 p-2\">\n<div data-bg=\"url(https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/03\/AT-logo-white.png)\" class=\"p-0 mt-2 mb-2 h-75 text-center rocket-lazyload\">\n<p><img decoding=\"async\" src=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/03\/AT-logo-white.png\" class=\"logo m-0 p-0 invisible\"><\/p>\n<\/div>\n<\/div>\n<p><h3 class=\"d-inline mr-3\">Support Local Journalism<\/h3>\n<p><button class=\"btn d-inline\" type=\"button\" onclick=\"handleDonationButtonClickMidArticle()\">Donate<\/button><\/p>\n<\/div>\n<p><\/div>\n<\/div>\n<p>While bankruptcy is often a last resort, it\u2019s also symbolic of hope and new beginnings. Here are some of the most important facts about filing for bankruptcy.<\/p>\n<p><strong>1. Bankruptcy is a fresh start<\/strong><\/p>\n<p>A bankruptcy gets rid of a person\u2019s dischargeable debt, completely free and clear, and it\u2019s tax free. Ray said if you owe a creditor $20,000, for example, and the creditor will settle that debt with you for $10,000, you\u2019d still have to pay taxes on the remaining $10,000. With a bankruptcy, you don\u2019t owe the debt or the taxes \u2014 and it\u2019s gone for the rest of your life.<\/p>\n<p>When you file for bankruptcy, you have to take a credit counseling course which helps debtors budget their income and expenses.<\/p>\n<p>\u201cIt really helps them in the long run to avoid filing for bankruptcy again,\u201d Ray said.<\/p>\n<p>Ray points out that once you file bankruptcy, you\u2019re on the hook for any debt acquired after the date of the bankruptcy filing. A person cannot file for bankruptcy again for another eight years.<\/p>\n<p><strong>2.<\/strong> <strong>Bankruptcy is nothing to be ashamed of<\/strong><\/p>\n<p>Ray\u2019s bankruptcy clients are hard-working, responsible people who have fallen on hard times for various reasons. Some were trying to keep their small businesses afloat, while others built credit card debt they thought they could pay back.<\/p>\n<p>For some, a job loss occurs at the same time as unforeseen medical or other expenses \u2014 next thing you know you just can\u2019t keep up with the bills, Ray said.<\/p>\n<p>\u201cIt doesn\u2019t mean you\u2019re incompetant or irresponsible,\u201d Ray said. \u201cThere\u2019s a stigma around bankruptcy, which is really unfortunate.I would say that most of my clients can\u2019t avoid it.\u201d<\/p>\n<p><strong>3. Creditors can no longer collect on you<\/strong><\/p>\n<div class=\"p402_hide\">\n<div class=\"wp-block-image\">\n<figure class=\"aligncenter size-large is-resized\">\n<p><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/headshot-682x1024.jpeg\" alt class=\"wp-image-326580\" width=\"512\" height=\"768\" srcset=\"https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/headshot-682x1024.jpeg 682w, https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/headshot-200x300.jpeg 200w, https:\/\/cdn.aspentimes.com\/wp-content\/uploads\/sites\/5\/2020\/05\/headshot.jpeg 719w\" sizes=\"auto, (max-width: 512px) 100vw, 512px\"><\/p><figcaption><strong><em>Diana A. Ray, Glenwood Springs bankruptcy attorney.<\/em><\/strong><\/figcaption><\/figure>\n<\/div>\n<\/div>\n<p>Once you file bankruptcy, creditors are no longer able to collect on you. What\u2019s more, these creditors can no longer harass you regarding the outstanding debt.<\/p>\n<p>\u201cIf you\u2019re getting calls from creditors, once you file they have to stop,\u201d Ray said. \u201cIt\u2019s called an automatic stay and there are enormous penalties for creditors if they violate it.\u201d<\/p>\n<p><strong>4. Some debts are excluded<\/strong><\/p>\n<p>Not all debts get erased after filing for bankruptcy. The most common debts that are considered nondischargeable are alimony, child support payments, student loans, and certain tax debt.<\/p>\n<p>\u201cIt\u2019s important to talk to an attorney to figure out your options and which debt is dischargeable and which is not depending on which Chapter of bankruptcy you file\u201d Ray said.<\/p>\n<p><strong>5. You will be able to build your credit again<\/strong><\/p>\n<p>While it\u2019s true your credit score will go down after a bankruptcy, it\u2019s not hard to rebuild your credit and increase your score after filing.<\/p>\n<p>\u201cFor many of my clients, their credit score was already bad,\u201d Ray said.<\/p>\n<p>The bankruptcy filing shows up on a credit report for 10 years, but within a year of filing you can start to see increases to your credit score.<\/p>\n<p>\u201cI counsel people on how to increase their credit,\u201d Ray said. \u201cAfter you file, you\u2019ll be bombarded with offers for loans and credit cards. The interest rate might be higher because of the bankruptcy, but you will get offers.\u201d<\/p>\n<p>Ray said it\u2019s important to build credit again by opening accounts and paying them off. You could open one credit card account, for example, and charge just $20 per month to it and then pay it off in full.<\/p>\n<p>\u201cIt shows you\u2019re paying off your monthly debt,\u201d she said.<\/p>\n<p><strong>6. Your home may be protected<\/strong><\/p>\n<p>Many people worry that because they own assets such as real property, they won\u2019t be able to hold on to those assets after a bankruptcy.<\/p>\n<p>\u201cThat might not be true,\u201d Ray said. \u201cYour home is protected as long as it\u2019s under the exemption amount. If you meet the criteria \u2014 and most people commonly do \u2014 it\u2019s protected.\u201d<\/p>\n<p>There are certain criteria you have to meet, thus, it is always a good idea to discuss your options with a bankruptcy attorney.<\/p>\n<p><strong>7. You can file without your spouse<\/strong><\/p>\n<p>If you\u2019re married, you can file for bankruptcy on your own or jointly with your spouse. If you file solo, the bankruptcy won\u2019t appear on your spouse\u2019s credit, Ray said.<\/p>\n<p>\u201cIn determining whether a joint or single filing is warranted, it just depends on the scenario,\u201d she said. \u201cI routinely file for clients without their spouse being involved.\u201d<\/p>\n<p><strong>8. Bankruptcy is complicated, an attorney is highly recommended<\/strong><\/p>\n<p>Filing for bankruptcy is a complex process. There are many nuances to the law that could backfire if overlooked.<\/p>\n<p>For example, listing all creditors, listing the appropriate exemptions for assets, and knowing what kind of expenses you can or can\u2019t incur leading up to the filling. An attorney will navigate all of those details.<\/p>\n<p>\u201cAt any point, if you\u2019re contemplating bankruptcy, call an attorney because there\u2019s so much planning that needs to be done \u2014 so many things you need to do or not do that could affect your bankruptcy.\u201d<\/p>\n<p>\u201cIf you think you might file in the future, it\u2019s so important to talk to an attorney. If you think you might be in this situation six months from now, talk to me now.\u201d<\/p>\n<p><a href=\"https:\/\/www.aspentimes.com\/news\/8-things-everyone-should-know-about-filing-for-bankruptcy-sponsored\/\" target=\"_blank\" rel=\"noopener noreferrer\">via:: The Aspen Times<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Editor\u2019s Note: Sponsored content brought to you by Diana A. Ray, Attorney at Law Bankruptcy is a fresh start for people who are unable to pay down their debts (see factbox). Bankruptcy gets rid of dischargeable debt, completely free and clear, and it\u2019s tax free.Getty Images When people fall on hard financial times, there\u2019s one [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[49],"tags":[],"class_list":["post-2458975","post","type-post","status-publish","format-standard","category-local-news"],"acf":[],"publishpress_future_action":{"enabled":false,"date":"2026-08-16 23:33:24","action":"change-status","newStatus":"draft","terms":[],"taxonomy":"category","extraData":[]},"publishpress_future_workflow_manual_trigger":{"enabledWorkflows":[]},"distributor_meta":false,"distributor_terms":false,"distributor_media":false,"distributor_original_site_name":"KSPN The Valley&#039;s Quality Rock","distributor_original_site_url":"https:\/\/alwaysmountaintime.com\/kspn","push-errors":false,"_links":{"self":[{"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/posts\/2458975","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/comments?post=2458975"}],"version-history":[{"count":0,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/posts\/2458975\/revisions"}],"wp:attachment":[{"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/media?parent=2458975"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/categories?post=2458975"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/alwaysmountaintime.com\/kspn\/wp-json\/wp\/v2\/tags?post=2458975"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}