The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.
When contemplating bankruptcy, most individuals find themselves in a state of financial distress. Added stress can come from having to worry about how much it is going to cost. However, understanding the costs associated with bankruptcy can help you make the decision that is right for you. In this information, you’ll learn about the various court filing fees, along with attorney fees should you choose to seek legal representation.
There are different costs associated with filing for bankruptcy. These costs can vary based on which chapter of bankruptcy you file and if you choose to be represented by an attorney. For example, Chapter 7 bankruptcy, which is typically for individuals looking to eliminate debts, will have different fees than Chapter 13 bankruptcy, which is for a debt repayment plan. If you decide to seek legal help, attorney fees can vary depending on the complexity of your case.
Bankruptcy filing fees are payments made to the court for the right to have your case heard. Similiar to the overall cost, these filing fees vary depending on the type of bankruptcy you file. The fees are typically divided into a filing fee when you petition the court and an administrative fee.
When considering which form of bankruptcy is right for you, it’s important to note that Chapter 7 involves an additional fee because you’ll need to cover the costs of a trustee. In the Chapter 7 process, the trustee reviews your financial documents and provides information to the court regarding your assets and your eligibility for this type of bankruptcy.
A trustee is also involved in the Chapter 13 filing process, but their compensation comes from a percentage of the monthly payments you make as part of the payment plan.
The following fees are listed by the United States Courts:
Regardless of the type of bankruptcy you file, these fees are due when you petition the court. Because you’re likely in financial distress when you file for bankruptcy, there are some cases where you may be able to make payments on the filing fees or have the fees waived entirely.
For businesses filing Chapter 11 bankruptcy, the fees are typically paid in one lump sum.
Typically, the attorney fees for bankruptcy will vary depending on the complexity of your case and your location. Lawyers usually charge an hourly rate, and they can estimate the amount of time required based on various factors involved in the filing process. However, for simple or straightforward cases at Lexington Law Firm, our fees are a set flat rate. Complicated cases may require hourly fees.
Since Chapter 7 is the most common type of bankruptcy, many people wonder, “How much does it cost to file Chapter 7 bankruptcy?” Different studies have produced a range of results for national averages.
Factors affecting your attorney fees include how you’re filing, what types of assets you have and much more. These are just some of the factors to take into consideration when you hire an attorney:
While you may know you need to file for bankruptcy, you may not know the correct process, which is where a bankruptcy attorney can help. Filing for bankruptcy not only involves quite a bit of paperwork, but it has to be done properly. If any documents are forgotten or left out, the court may not approve your case, and they may even charge you with bankruptcy fraud.
Similar to how it’s helpful to have a credit lawyer when disputing errors on your credit report, a lawyer’s expertise can help you with the bankruptcy process. They know exactly what the courts are looking for so you don’t miss anything when you file. Working with an attorney can also improve your chances of having your bankruptcy approved in a way that gives you the best outcome.
In addition to the bankruptcy costs for filing, there are mandatory credit counseling courses that you’ll need to take. Before your bankruptcy is discharged, you’ll also need to take a debtor education course. These courses can be taken online, and they’re meant to help those who file manage their finances better.
The credit counseling courses can range between $10 and $50. For the debtor educator course, the cost is within the same $10 to $50 range. These courses must be taken through approved providers, which you can find on the U.S. Courts website.
Bankruptcy is often a last resort when you’re struggling with debt, so it can be difficult to find the money to cover the costs. Here are some ways you can file for bankruptcy while also saving some money:
If you’re in a situation where you don’t have the money to pay, there are some options you can look into. Finding additional sources of income through side work is always a great way to raise money, but there are also services for those with financial hardships.
Note: Articles have only been reviewed by the indicated attorney, not written by them. The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, reviewers, contributors, contributing firms, or their respective agents or employers.
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