Filing for Bankruptcy Costs

Filing for bankruptcy is a major decision. It can get you out of a challenging financial situation, but can you afford it? If cash is tight, you might not...

Filing for bankruptcy is a major decision. It can get you out of a challenging financial situation, but can you afford it? If cash is tight, you might not be able to file as easily as you had hoped. These are the overall prices for filing for bankruptcy.  

Chapter 7 Bankruptcy Costs

To file for Bankruptcy, you need to pay a filing fee. For a Chapter 7, you can expect the fee to be $335 to file. There may also be additional costs such as a Bankruptcy Trustee fee, conversion fee, and courses –in 2005, a reform to bankruptcy made a change where individuals who file must undergo credit counseling and education. Credit counseling occurs before you file, and debtor education occurs after you have submitted your claim. You have to pay for these courses, and the costs differ from program to program. To discover a full list of possible costs, you may go to the United States Courts site . This government website will list all the fees and will notify you if the costs ever change. 

Chapter 7 Bankruptcy Attorney’s Fees 

Most people who go to court decide to hire a lawyer to help them finish filing for bankruptcy. Lawyers may charge whatever they want for their services and you will  need to pay upfront. The fees vary based on location and per instance. “Simple Asset” cases can be completed with minimal work, but the more resources and the more complex the situation, the more work the attorney will have to do. Based on US News, the average fee in the country was approximately $1,500 in 2012. 

Chapter 13 Bankruptcy Prices

Chapter 13 bankruptcy also has a filing fee of $310 no matter your financial crises. Like Chapter 7, you also need to attend credit counseling before you file and debtor education after you file. The classes have to be approved by the United States Trustee Program and aren’t free. It’s the obligation of the borrower to cover the classes. You will get a complete list of courses offered in your state on the United States Courts site .

Chapter 13 Bankruptcy Attorney’s Fees

The fees for a bankruptcy lawyer when declaring Chapter 13 varies. However, the law states that the fees have to be approved by the court and your lawyer. Based on your location, the expense can vary. According to Nolo, you can expect the costs to vary from $2,500 to $5,500. During Chapter 13, you are going to utilize a trustee to create a payment plan that is suitable for your financial situation. 

Per Se Bankruptcy Cases

Do you want a lawyer? The brief answer is no, you do not need to have an attorney, but your success rate significantly increases when you are working with a legal practitioner. According to a 2014 study, over a third (45.6% ) of  bankruptcy cases were dismissed while the attorney-represented instances where only at 13.7% of all bankruptcy cases were dismissed when not.

 

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