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Law Girl
Law Girl, Attorney
Category: Bankruptcy Law
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Because of my erroneous choice to use a debt ...

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Because of my erroneous choice to use a debt settlement company, I now have one judgement against me with another pending. Up until August 2007 I had perfect credit. I have cashed in my entire retirement funds to stay afloat during this time as well. My questions are: What takes place with a judgement? If I am to file bankruptcy are my retirement funds no longer exempt since I cashed them in and put them with my general living funds. I also have a rental property, do I just include that in a BR and forfeit all equity? I am mostle concerned at the moment about the judgements. Can they raid my bank account or what can they do?
Submitted: 9 years ago.
Category: Bankruptcy Law
Expert:  Law Girl replied 9 years ago.
What state are you in?
Customer: replied 9 years ago.
Reply to Law Girl's Post: I am in Colorado.
Expert:  Law Girl replied 9 years ago.


Thank you for your question.

In the event of a judgment, the creditor has to take steps to enforce it. By changing the characteristic of your retirement funds, they no longer enjoy any protection against creditors.

In order to enforce the judgment, your creditor has the ability to attach the judgment to any of your assets, including your primary residence. In Colorado, the homestead exemption protects your primary residence for up to $45,000 in value. (See Colorado Revised Statutes Annotated, §38-41-201.) Your creditor also has the ability to garnish up to 75% of your Disposable Earnings

Filing of bankruptcy could discharge the judgment. However, in filing bankruptcy, it is likely that you would lose your rental property, or any property that is not your primary residence (depending on the type of bankruptcy you file).

Please let me know if you have any other questions, or require clarification of this matter. Otherwise please hit "ACCEPT", so I may receive credit for my response. Tips and feedback are also appreciated.

Good Luck!



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