Colorado Massively Expands Bankruptcy Protections for Homeowners. On April 7, Governor Polis signed into law a new set of “exemptions” for Colorado residents, almost quadrupling the equity homeowners can protect if they are forced into bankruptcy. While doubling the vehicle exemptions of everyone in the state as well. Previously unprotected items, like trailers and RVs, are now also protected – along with guns and bank accounts.
Suddenly, virtually all Colorado residents can now file bankruptcy without any danger of losing their home, vehicles, or even firearms. Most of those who file Chapter 7 cases will obtain a “fresh start” without losing any personal property or paying anything to their creditors.
For homeowners struggling to keep up on mortgage payments or facing foreclosure, the news is even better. Thanks to the massive increase in Colorado’s homestead exemption, most homeowners can immediately stop foreclosure and create a five-year repayment plan for their mortgage arrears, without having to repay any other debt in the process. This will lower the cost of bankruptcy relief for tens of thousands of Coloradoans who need post-COVID relief to save their homes after years of economic struggle.
While every situation is unique, these new protections are astonishingly broad. With that in mind, the bankruptcy code, and filing process overall, remain incredibly technical and complex: those looking to take advantage of the new exemptions will likely need an attorney’s assistance to navigate the process.
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Devon Barclay is a local bankruptcy attorney. He can be reached at 720-515-9887 or at firstname.lastname@example.org.
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