FAQ

  • Bankruptcy

    • Q: CAN I DISCHARGE MY STUDENT LOANS IN BANKRUPTCY? IF NOT, WHAT SHOULD I DO?
      A: Under current law, there is a presumption against the dischargeability of student loans in bankruptcy. You may overcome this presumption and obtain a partial or complete discharge of your student loan obligations if you can establish that not discharging the student loans would cause you or your dependents “undue hardship.” Generally, courts have been fairly strict in applying this standard, which means that most debtors in bankruptcy do not even try to discharge their student loans, which requires the filing of a separate lawsuit, called an Adversary Proceeding, within the main bankruptcy case. However, if you have overwhelming student loan debt and other issues, such as health problems, that make it difficult or impossible for you to work in the field for which you studied, or earn enough money to support yourself, you should ask your lawyer to evaluate the possibility of seeking to discharge your student loans in bankruptcy. If the prospects for discharging your student loans in bankruptcy are unfavorable, and you are otherwise eligible for an income-based repayment option, this may be your best alternative. You can learn more about student loans and income-based repayment options at the National Consumer Law Center (www.nclc.org). You may also find it worthwhile to explore the website of the Consumer Financial Protection Bureau (www.consumerfinance.gov).
    • Q: CAN I RENEGOTIATE A MORTGAGE IN A CHAPTER 13 BANKRUPTCY?
      A: Under current law the answer is “no”. However, you can make up mortgage arrearages over time and prevent foreclosure as long as you make your Chapter 13 plan payments. In addition, many debtors can “strip-off” junior liens such as second mortgages if the value of their home is equal to or less than the amount of their first mortgage.
    • Q: CAN I DISCHARGE UNPAID INCOME TAXES IN BANKRUPTCY?
      A: The answer is “yes” under certain circumstances. Generally, if the income tax obligation is more than three years old and you filed the income tax return at least 240 days prior to filing for bankruptcy, the income tax liability is dischargeable. However, income taxes that are less than three years old, and other kinds of taxes, including payroll withholding taxes, are not dischargeable.
    • Q: I AM IN FINANCIAL TROUBLE DUE TO THE FAILURE OF A SMALL BUSINESS. AM I STILL SUBJECT TO THE CHAPTER 7 MEANS TEST?
      A: The answer is “probably not.” The Chapter 7 Means Test applies to debtors whose debts are primarily consumer as opposed to business in nature. Personal guarantees of leases, business lines of credit and even credit cards used for business purposes are business debts. If business debts are larger than consumer debts then the debtor is not required to pass the Chapter 7 Means Test.
    • Q: I AM MARRIED, BUT MOST OF OUR DEBTS ARE IN MY NAME AND NOT MY SPOUSE’S. ARE WE REQUIRED TO FILE FOR BANKRUPTCY TOGETHER?
      A: The answer is “no”. It is frequently advantageous for only one spouse to file in order to preserve the credit rating of the non-filing spouse. However, if you live with your spouse and are subject to the Means Test, your spouse’s income must be included even if you file in your name only.
    • Q: ONE OF MY RELATIVES CO-SIGNED ON A LOAN WITH ME. IF I FILE FOR BANKRUPTCY WILL IT HURT THE CO-SIGNOR’S CREDIT?
      A: It should not. The relative will continue to be legally responsible for the repayment of the debt, and if payments are made, his or her credit should not be adversely affected by your filing.
    • Q: I AM BEHIND ON MY HOUSE PAYMENTS. IS IT BETTER TO LET MY HOUSE GO INTO FORECLOSURE OR SHOULD I TRY TO MAKE A “SHORT SALE”?
      A: If you have another place to go, it is usually in your best interest to try for the short sale. Mortgage companies will often forgive the unpaid balance on your loan in a short sale and some even have “cash for keys” programs which pay you up to $5,000 for cooperating in a short sale rather than letting your house go into foreclosure.
    • Q: I OWE A LOT MORE ON MY CAR THAN IT IS WORTH, BUT I WOULD LIKE TO KEEP IT. WHAT WILL HAPPEN TO MY CAR IN BANKRUPTCY?
      A: As a general rule, bankruptcy affects claims but not liens, which means that if you don’t make payments on assets such as cars and homes, the lenders can still receive permission from the bankruptcy judge to take possession of them. However, debtors are also allowed to “redeem” motor vehicles in Chapter 7, and “cram down” car loans in Chapter 13 that are more than 910 days old. This essentially allows the debtor to pay the creditor the value of the collateral while writing off the difference. This can often save you thousands of dollars while allowing you to keep the assets you need and value most.
    • Q: HOW WILL BANKRUPTCY AFFECT MY CREDIT?
      A: Bankruptcy, over the short term, will hurt your credit. However, many people who are thinking about filing for bankruptcy already have poor credit because they have defaulted on their debts or are about to. Many bankruptcy debtors can re-establish good credit within two to three years after filing bankruptcy especially if they keep making payments on their cars and/or homes and remain employed after filing.

  • Divorce

    • Q: HOW DO COLORADO JUDGES DIVIDE PROPERTY IN DIVORCE CASES?
      A: In Colorado, judges must first allocate to each spouse his or her separate property, and following that they are required to divide the couple's marital property in a "fair and equitable" manner. In Colorado there is no legal requirement for a 50/50 division of marital property. Factors such as one spouse having a large amount of separate property or a spouse making a disproportionate contribution to the accumulation of marital property can result in unequal property division.
    • Q: DO COLORADO JUDGES FAVOR MOTHERS IN CUSTODY DISPUTES?
      A: It is hard to generalize about the prejudices of individual judges, but Colorado law does not discriminate against fathers, and in fact presumes that both parents should have substantial and frequent contact with their children. This does not mean, however, that parents will necessarily end up with a 50/50 parenting time arrangement. The physical proximity of the parents, their ability to co-parent after the divorce, and the wishes of the children are among the factors that are taken into consideration by Colorado judges in fashioning parenting time schedules. The guiding principle in this undertaking is not what is in a parent's best interests, but what is in the children's best interests. In custody cases, it is common for the court to appoint a child and family investigator, who is often a social worker or psychologist, to interview the parties, their friends and relatives, and the children, and make recommendations to the judge.
    • Q: IS COLORADO A COMMON LAW MARRIAGE STATE?
      A: Yes. However, there is no set period of time (e.g., 7 years) that parties must cohabitate to become married in the eyes of the law. Instead, whether parties are married depends upon their intent. In order to establish a common law marriage it must be proved that there was some form of mutual public acknowledgment of the marital relationship. Given the absence of a marriage ceremony, a mutual public acknowledgment of the marital relationship is usually proven by establishing the couples "general repute" as being married in their community. Friends, relatives and neighbors are therefore important witnesses in contested common law marriage cases because they can testify whether they understood the couple to be married or not and why. Other factors that judges can take into consideration besides cohabitation are whether the woman has taken the man's surname, whether children born to the couple have the man's surname, whether either or both parties wore wedding rings, whether the parties owned property together, and whether the couple filed income tax returns as a married couple.
    • Q: DO I NEED A LAWYER TO REPRESENT ME IN MY DIVORCE?
      A: The answer is sometimes. If a couple has been married a short time, have little or no marital property and no children, hiring a lawyer is probably not necessary. However, in cases in which there is substantial property, potentially undisclosed or undervalued assets, or disagreements regarding custody, spousal maintenance or child support, an experienced divorce attorney is needed. It is a particularly bad idea for one spouse to represent him or herself against a represented spouse. Colorado, like every other State, has an adversary system of justice which presumes that both sides in a dispute will effectively represent their own interests.
    • Q: MY HUSBAND MAKES MORE MONEY AND/OR CONTROLS MORE OF THE ASSETS THAN I DO. CAN THE COURT ORDER HIM TO PAY MY ATTORNEY'S FEES?
      A: The answer is yes. Colorado judges have the authority to allocate legal expenses between the parties and it is common for judges to do this. Both sides have the right to competent legal counsel and in Colorado the law is clear that it is appropriate for legal expenses to be paid with marital funds regardless of which spouse controls these funds.
    • Q: MY WIFE THINKS THAT THE MONEY SHE EARNS FROM HER JOB AND THAT THE MONEY IN HER RETIREMENT ACCOUNT IS "HERS". IS THIS TRUE?
      A: The answer is probably not. Money earned by either party in a divorce case is marital property subject to division by a judge. Judges, particularly at the early stages of a divorce case, are not concerned about who earns it. Money in retirement accounts may be separate, marital or a bit of each. For example, if a the wife had $100,000 in her retirement account on the date of the marriage, and $200,000 in the account on the date the divorce decree is entered, $100,000 of the account is separate property that must be set apart to her. The remaining $100,000 is marital property which the judge is required to fairly and equitably divide between the parties.
Back to Top