How Much Does It Cost To File Chapter 13 Bankruptcy – The cost of filing for bankruptcy varies from a few hundred to several thousand dollars, depending on the type of bankruptcy you’re filing for and whether or not you choose to work with an attorney. If the cost seems too high, you may have options to make the process more affordable.
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How Much Does It Cost To File Chapter 13 Bankruptcy
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Filing for bankruptcy can cost anywhere from a few hundred to several thousand dollars, depending on the type of bankruptcy case filed and whether you hire a lawyer or use a do-it-yourself approach.
The filing fees and other expenses required to file for bankruptcy typically range from $300 to $400. If you are self-submitting, you may not have to pay much more.
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Working with a bankruptcy attorney can greatly increase these numbers. Their fees can vary greatly depending on the type of bankruptcy you’re filing for, the market rate your attorney works for, and the complexity of your financial situation.
Coming up with any extra money can seem impossible if you’re already struggling to pay your basic expenses with creditors breathing down your neck. Fortunately, help may be available if you think bankruptcy is the right choice for you.
Let’s take a look at the two common types of bankruptcy, the fees you may be liable for, and a few ways to pay them.
There are two common types of bankruptcy that you may consider as an individual consumer: Chapter 7 bankruptcy and Chapter 13 bankruptcy.
Chapter 7 Bankruptcy
Under Chapter 7 bankruptcy, many of your assets are liquidated and the proceeds are used to pay down debt to your creditors. After paying your creditors and paying off your eligible debts, you are no longer responsible for paying off your debts (as long as they are included in the repayment).
Instead of paying off eligible debts in full, Chapter 13 bankruptcy is more like an extended repayment plan. You develop a plan to pay off your debts within three to five years, which gives you the opportunity to keep more of your assets than if you filed for Chapter 7 bankruptcy.
While credit card debt and many other forms of debt can be written off when applying under Chapter 7, some are not. Examples of unsustainable debt include child support or child support, certain taxes, certain student loans, and more. If you have an outstanding debt, you will be liable to pay it off even if you file for Chapter 7 bankruptcy.
In the event of both Chapter 7 and Chapter 13 bankruptcy, you will be liable to pay fees only for the bankruptcy court to hear your case. These include…
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If you choose to work with a lawyer, legal fees will likely be the largest portion of your bankruptcy costs. But it’s almost certainly worth it.
Bankruptcy laws are complex and you can lose income or property unnecessarily if you are not familiar with the law. Good legal advice can help protect you and improve your chances of a favorable outcome.
“Our goal is to make the bankruptcy process as easy as possible for [our] clients. We are here to anticipate any problem that can be…prevented,” says Ashley Morgan, a bankruptcy attorney in Northern Virginia. “It usually takes me more time and money to fix problems [after someone submits the file] than it takes me to prevent them.”
The cost of hiring a bankruptcy attorney varies widely depending on the market rate in your area and the complexity of your case.
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As a general rule, costs between $500 and $3,500 are considered typical for Chapter 7. You will need to pay a fee before you file your application, as attorney’s fees may be considered part of the debt on a successful Chapter 7 application.
Chapter 13 filing fees typically range from $2,500 to $6,000, but you usually don’t have to pay the full amount up front. You may be able to pay off some of the debt before you apply and pay off the rest as part of your debt repayment plan.
To protect consumers from being overcharged, bankruptcy judges have the power to review attorney fees to ensure they are reasonable. In fact, many courts have set a “no-hear” fee, which sets a threshold below which the court will generally not review your attorney fees (although this is still an option at the discretion of the court).
If your attorney charges a fee above the “no review” threshold, the fee may be reviewed to ensure it is appropriate given the details of your case.
Chapter 7 Bankruptcy. Weston Legal, Pllc
“Most bankruptcy attorneys offer free consultations, [so] it’s okay to at least meet with a lawyer,” Morgan says.
During the consultation, they will probably be able to give you an idea of how much it will cost them to represent you. If you’re worried about how you’ll be able to pay for legal aid, many lawyers are willing to set up payment plans.
If you’re feeling overwhelmed by the fees it takes to file for bankruptcy—from the cost of filing to other court fees and court fees—there are a few ways you can cut some costs and raise money to pay the rest.
Bankruptcy filing fees, credit counseling fees, and consumer education fees are well known and consistent, no matter where you live or how complex your case is.
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On the other hand, attorneys’ fees vary widely and can greatly increase your bankruptcy costs. While the price may seem high, it’s probably worth at least considering working with a lawyer when filing for bankruptcy.
If you feel that all these costs are too much, it does not mean that you should forego bankruptcy if that seems like the best option for your situation. Think about some of the types of help that may be available to you, or find ways to raise the money you need to pay. Short-term costs can be worth the long-term relief.
About the Author: Jennifer Brozick is a freelance financial services writer with a bachelor’s degree in journalism from the University of Maryland and a master’s degree in communications management from Towson University. She is committed to… Read more. We are an independent ad-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and unbiased content, allowing you to research and compare information for free, so you can make financial decisions with confidence.
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Ask An Attorney: How Much Does It Cost To File Personal Bankruptcy?
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Bankruptcy Statistics Up To 2022
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