The decision to file for bankruptcy is not one you should take lightly. One of the main questions anyone considering bankruptcy wants to know is: how much will it cost?
The answer to this question is dependent on a number of factors. Learning a bit about the factors and the average cost to file can help you decide whether or not bankruptcy is the course you wish to take.
Required Courses and Filing Fees
When filing for bankruptcy, you will have to obtain credit counseling and take a course on personal financial management. Our office uses a credit counseling course that can be taken for $15. The counseling takes approximately one hour and is completed online. If you would prefer to complete a course over the phone, we can direct you to a credit counseling service who conducts the over the phone sessions for $35.
Also, anyone who decides to file for bankruptcy has to pay a filing fee. The fees are:
- Chapter 7: $335
- Chapter 13: $310 (in KS, this fee often does not need to be paid before filing).
Chapter 7 Bankruptcy Attorney Fees
When filing a Chapter 7, most of the debts you owe are barred from collecting. This includes attorney fees. Therefore, filing for Chapter 7 means you will have to pay the attorney fees up front. However, we at Patton & Knipp do not take any attorney fees until the day you sign the paperwork to file the case.
Bankruptcy Attorney fees for Chapter 7 range from firm to firm. The attorney fees you are charged will depend on the firm you choose, whether or not you are below median and whether or not you operate a business.
At Patton & Knipp, our normal rate for Chapter 7 attorney fees is $1,250. If you are above median or have an altogether complex case, we may charge more. But all our fees will be disclosed at the initial consultation. There will be no hidden expenses.
Chapter 13 Bankruptcy Attorney Fees
With a Chapter 13 bankruptcy, you work with the Trustee to create a repayment plan for all of your debts. The plan will typically span a period of three to five years, and at the end, all remaining unsecured debt is discharged. Unlike when filing for Chapter 7, local bankruptcy law will typically determine the reasonable fees for these types of cases.
The reasonable fees are usually based on the case’s complexity. The average around the country is about $3,000, but each bankruptcy district will have set standards that determine this. During a Chapter 13 case, the attorney will likely charge a certain fee initially and the rest of the fee is made through the payment plan that is established.