On July 1, 2015, the Colorado Exemption laws were changed to increase the dollar amount of much of the property a person can protect when filing a Chapter 7 Bankruptcy. This is very good news as these amounts have not been increased in many years, despite inflation and the rising value of real estate.
Perhaps the most important increase was to the Homestead Exemption which increased the amount of equity you can protect in your home from $60,000 to $75,000, or from $90,000 to $105,000 for a person 60 or older or a person who is disabled. As I discussed in earlier blogs, the increase in real estate values in recent years has pushed many up to or over the old exemption amount, so this increase gives a person filing bankruptcy a little more breathing room in protecting their home.
Another important increase was for automobiles from $5,000 to $7,500, or from $10,000 to 12,500 for a person over 60 or disabled. The exemption is now limited, however, to only two vehicles, where no such limitation existed under the old law.
While homes and cars were the biggest changes, other increases were as follows:
-wearing apparel or clothes from $1,500 to $2,000
-tools of the trade from $20,000 to $30,000
-watches and jewelry from $2,000 to $2,500
-books and pictures from $1,500 to $2,000
These increases are very good news for those considering filing bankruptcy in Colorado. The protection of greater amounts of property are very important for having the tools necessary for getting a fresh start.