How Much Does Bankruptcy Cost?
The cost of your bankruptcy filing is hard to determine. The costs vary depending on which chapter of bankruptcy you file under, which attorney you hire, and other various choices that occur over the course of developing your bankruptcy. To answer the question, we’ll look at the most common costs associated with bankruptcy filings.
Attorney’s Fees
Attorney’s fees have the largest ranges of bankruptcy costs. It is hard to say what a particular attorney will charge. Usually, attorneys charge a flat rate fee for all the work that is common in a bankruptcy case. If they take the payment on installment or in lump sum and whether or not they start work before their fee is paid varies from law firm to law firm.
Chapter 7 filings generally have the lowest attorney fees. In Milwaukee, they usually range between $500 and $1,500, but they can go above and below that too depending on the case. The majority of attorneys charge between $500 and $1000 for just the attorneys fee portion. Chapter 7 fees are usually required to be paid before the case is filed. Some attorneys offer split-representation where they only are hired to do some of the work upfront and then are hired again after the filing to finish the case.
Chapter 13 filings are more uniform. Milwaukee attorneys usually charge around $3,500 for the 3 to 5 years of representation required of a Chapter 13 bankruptcy. These fees can be paid over time during the bankruptcy and a portion of the monthly payments can go to the attorney. Even though the number is higher, most people find paying for the attorney fees in Chapter 13 far easier than other cases.
Chapter 11 filings are much more complicated and do not usually charge flat fees. Each attorney bills at their hourly rate against a large retainer. However, most consumers don’t file for Chapter 11 bankruptcy protection.
Be aware if your attorney includes the filing fee in their fees or if they just are quoting their fee. An attorney who charges $950 with filing fee included results in a smaller bill than the attorney who has a $700 fee separate from filing fees.
Credit Counseling and Financial Management Class
If you are and individual filing for bankruptcy, you will need to take a Credit Counseling Class before you can file and a Financial Management Class before the discharge. These classes are usually taken over the phone or online, but are available in person as well. Most classes are between $10 and $25. If you shop around you can find a good rate.
Bankruptcy attorneys usually have a preferred provider who offers a deal to the clients. Ask your attorney if they are part of such a program.
Filing Fees
Filing fees are fixed costs that are set by the courts. They are $335 for a Chapter 7 and $310 for a Chapter 13.
Fees are most often paid in full when the case is filed. There are options to pay the fees in installments and to waive the fee entirely. You must motion the court to request these options and the judge decides if they are appropriate for your case. Ask your attorney about whether or not these options work for you.