Colorado’s $250,000 homestead exemption keeps the liquidation test floor manageable for most homeowners in Chapter 13 — even in a state where Denver-area home values have climbed substantially. But Colorado’s total lack of a wildcard exemption means filers with property outside the standard categories need careful planning to keep the plan payment focused on actual disposable income.
How Chapter 13 Works in Colorado
You file a petition and propose a repayment plan lasting three to five years. A standing Chapter 13 trustee collects your monthly payment and distributes it — secured debts first, then priority claims, then whatever’s left goes to unsecured creditors. You keep all your property throughout, and remaining qualifying unsecured debt is discharged when the plan completes.
The exemptions you claim set your plan’s liquidation test floor — the minimum unsecured creditors must receive.
How Colorado’s Homestead Exemption Affects Your Plan
Colorado’s homestead exemption protects $250,000 in home equity, or $350,000 if you, your spouse, or a dependent is 60 or older or disabled. Colorado is an opt-out state, so filers must use Colorado's own exemption list rather than the federal exemptions. Colorado also has no wildcard exemption - property has to fit a specific statutory category to be protected. Because there’s no wildcard, filers with property that doesn’t fit the homestead, vehicle, or household goods categories need their attorney to carefully evaluate what’s actually exposed to the liquidation test.
Why Colorado Filers End Up in Chapter 13
Mortgage arrears are the most common driver — catching up on missed payments without losing the house, especially valuable given how much equity many Colorado homeowners have built. Income above the means test threshold is the second major factor, and Colorado’s high median income figures mean even well-compensated filers can land above the cutoff.
Do You Qualify for Chapter 7 Instead? The Means Test
Colorado’s current median income figures:
- 1 person: $87,940
- 2 people: $109,497
- 3 people: $130,850
- 4 people: $153,501
- Each additional person: add $11,100
Filers above the median for their household size generally must commit to a five-year plan; those below can propose three years.
Mortgage Cure in Colorado
Filing Chapter 13 triggers the automatic stay, halting foreclosure immediately. The plan spreads mortgage arrears across its three-to-five-year duration while you resume regular payments going forward.
Vehicle Treatment and Cramdown
Colorado exempts $15,000 in equity in one motor vehicle. If your car loan was originated far enough before filing and the vehicle is worth less than the remaining balance, the plan can cram the loan down to the vehicle’s current market value at a court-approved interest rate.
Which Federal District Do You File In?
District of Colorado - a single statewide district based in Denver, serving the entire state.How Much Does a Chapter 13 Attorney Cost in Colorado?
Chapter 13 attorney fees in Colorado typically run $3,500 to $4,100, on top of the 313 federal filing fee. Most of the fee is built into the plan itself.
Common Mistakes Colorado Filers Make
Assuming a wildcard exemption exists. Colorado has none — this can catch filers off guard when accounting for property that doesn’t fit the standard categories.
Missing required tax filings during the plan, which can trigger a motion to dismiss.
Overlooking a non-filing spouse’s income in the means test.
Not checking eligibility for the age-60/disability homestead increase, which can lower the liquidation test floor for qualifying filers.
A Realistic Example
Consider a filer we’ll call Rachel, living in Colorado Springs. She works in healthcare administration and fell behind on her mortgage after a period of reduced hours. She owns her home with about $200,000 in equity.
Colorado’s $250,000 homestead exemption fully covers her equity, keeping her liquidation test floor at zero on the housing side. Her attorney focuses the plan on her actual disposable income rather than any unprotected assets.
Her income lands above Colorado’s median for a household of one, so she commits to a five-year plan. The mortgage arrears are spread across the plan while she resumes regular payments. Five years later, the mortgage is current and the remaining unsecured debt is discharged.
Frequently Asked Questions About Chapter 13 Bankruptcy in Colorado
Can Chapter 13 stop foreclosure in Colorado?
Yes. Filing triggers the automatic stay, which halts foreclosure immediately. Your plan then spreads the mortgage arrears across three to five years while you resume regular payments.
Does Colorado’s homestead exemption apply in Chapter 13?
Yes. Colorado protects $250,000 in home equity ($350,000 if you’re 60 or older or disabled), which keeps the liquidation test floor low for most homeowners.
How long does a Chapter 13 plan last in Colorado?
Three to five years. Filers with household income above Colorado’s median for their household size generally must propose a five-year plan; those below can propose three years.
Can I keep my car in a Colorado Chapter 13?
Yes — Chapter 13 doesn’t require giving up property. If your car loan is old enough and the vehicle is worth less than the loan balance, the plan may also cram down the loan to the vehicle’s current value.
What is the Colorado bankruptcy means test income limit?
It depends on household size and updates periodically. Current thresholds are roughly $87,940 for one person, $109,497 for two, $130,850 for three, and $153,501 for four, with $11,100 added per additional person.
Does Colorado have a wildcard exemption in Chapter 13?
No. Colorado does not offer a wildcard exemption. Property must fit a specific statutory category to be protected, which can affect the plan’s liquidation test.
Where to Verify the Details
Colorado’s exemption statutes are published in Colo. Rev. Stat. § 38-41-201 et seq. For current means test figures, check the U.S. Trustee Program website.
Alternatives to Chapter 13 in Colorado
If you pass the means test and don’t need to cure a mortgage, our Chapter 7 guide for Colorado explains how straight liquidation might discharge your debt faster.
Last reviewed by American Debt Guide Editorial Team. Figures on this page reflect Colorado bankruptcy exemption amounts and federal filing data as of July 2026.