The Automatic Stay & Discharge in Colorado
Filing bankruptcy triggers the automatic stay (11 U.S.C. § 362), an immediate halt to most collection — lawsuits, wage garnishment, repossession, and foreclosure. A discharge (11 U.S.C. § 524, § 727) permanently bars collecting discharged debts, but some debts are non-dischargeable (11 U.S.C. § 523), including most recent taxes, student loans absent undue hardship, child support and alimony, and debts from fraud.
By Find Local Law Editorial Team · Last reviewed: May 26, 2026
Researched and drafted with AI assistance and verified against primary sources (statutes, Judicial Council forms, and official court websites). This is general information, not legal advice.
This is general information, not legal advice. How the stay and discharge apply to your debts is fact-specific — talk to a Colorado bankruptcy attorney.
Two features make bankruptcy work: the automatic stay that stops collection immediately, and the discharge that permanently erases qualifying debts.
The automatic stay
The moment you file — whether Chapter 7 or Chapter 13 — the automatic stay takes effect (11 U.S.C. § 362). It’s an immediate halt to most collection, including:
- Lawsuits and collection calls
- Wage garnishment
- Repossession of vehicles
- Foreclosure on your home
The stay buys you breathing room while your case moves forward.
The discharge
At the end of your case, the discharge (11 U.S.C. § 524, § 727) permanently bars creditors from collecting the debts that were discharged. A creditor who tries to collect a discharged debt is violating a federal court order.
Debts that are NOT discharged
Not everything goes away. Some debts are non-dischargeable (11 U.S.C. § 523), including:
- Most recent taxes
- Student loans (absent a showing of undue hardship)
- Child support and alimony
- Debts from fraud
What you ultimately keep also depends on Colorado’s exemptions.
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Start your free intakeFrequently asked questions
- What does the automatic stay do?
- The moment you file, the automatic stay (11 U.S.C. § 362) halts most collection — lawsuits, wage garnishment, repossession, and foreclosure must stop. It gives you breathing room while your case proceeds.
- What does a discharge actually accomplish?
- A discharge (11 U.S.C. § 524, § 727) permanently bars creditors from collecting the debts that were discharged. It is the core relief bankruptcy provides.
- Which debts can't be wiped out?
- Some debts are non-dischargeable (11 U.S.C. § 523), including most recent taxes, student loans absent undue hardship, child support and alimony, and debts arising from fraud.
Sources
Related guides
- Chapter 13 Bankruptcy in Colorado Chapter 13 is a court-supervised repayment plan: 3 years if your income is below the state median, up to 5 years if at or above the median, and never longer than 5 years (11 U.S.C. § 1322(d), § 1325). It lets people cure a mortgage or car default and keep their property.
- Chapter 7 Bankruptcy in Colorado Chapter 7 is liquidation bankruptcy: a trustee can sell nonexempt property to pay creditors, and the individual debtor receives a discharge of most unsecured debts (11 U.S.C. § 727). It requires the means test and credit counseling. Because Colorado's exemptions protect typical assets, most Colorado filers keep their property.
- Colorado Bankruptcy Exemptions Colorado opted out of the federal bankruptcy exemptions (C.R.S. § 13-54-107), so Colorado filers use Colorado exemptions. Key protections include a homestead up to $250,000 (or $350,000 if elderly or disabled), a motor vehicle up to $15,000 (or $25,000 if elderly or disabled), household goods, clothing, tools of the trade, and limits on wage garnishment. Several figures were raised in 2022; confirm current.
- The Chapter 7 Means Test in Colorado The Chapter 7 means test (11 U.S.C. § 707(b)) compares your income to the median income for your household size in Colorado. Below median you generally qualify for Chapter 7; above median, a disposable-income calculation may create a presumption of abuse. Colorado median-income figures are updated periodically by the U.S. Trustee.