What You Should Know About Your Bankruptcy Lawyer’s Fees: Costs and Types
When planning to file for bankruptcy, it is essential to know the fees or attorney associated with filing the claims. Contrary to the popular myth that bankruptcy claim fees are decided by the court, it depends primarily on the type of bankruptcy claim and the law firm handling the case. Most of the time, there is a flat fee for filing, but it can vary depending on the nature of the case and the legal aid used to file such cases.
Let’s look at some of the types of costs and fees your law firm may request while helping you file popular Chapter 7 or Chapter 13 bankruptcy claims.
Average Cost of Chapter 7 Fees:
If you are filing Chapter 7, your attorney’s fees will largely depend on the complexity of the case. For simple bankruptcy claims, there may be a flat fee, but for complicated cases, it is up to the law firm to decide their fees and the cost of arbitration. Also, if you are in a higher income group and your assets are more than the state median for a similar household, you may be asked a higher fee compared to someone who has negligible or no assets. Also, in most cases, you must pay the fees up front before you apply.
Typically, he will charge something between $500 and $3000, depending on the complexity of the case. The larger and more popular firms may charge you a bit more compared to individual legal professionals. Similarly, you can also expect comparatively less fees from a new law firm compared to a well-established one. It is always recommended to check with a few in your area to learn their specific fee structures before hiring them. Also, if you are looking for a cheaper Bankruptcy Lawyer, you should check his specialization and experience and not just the fees.
Average Estimate of Chapter 13 Fees:
Most courts in various states have established a guideline for the average fees of Chapter 13 bankruptcy attorneys. Unless otherwise justified, no law firm will charge you more for filing for Chapter 13 bankruptcy. Different court districts, fees vary and are typically around $2,000 – $5,000 in different districts. There is always the possibility to pay the fees in installments and you do not have to pay them in advance.
In most cases under Chapter 13 bankruptcy, your bankruptcy attorney requests an upfront fee and the remaining amount is requested through a convenient payment plan scheduled over a few months. It is always recommended to be ready to pay almost half of the fees up front and the rest in installments, if someone files for Chapter 13 bankruptcy.
Hourly rates:
Depending on the nature of the case, your bankruptcy attorney may ask you for an hourly rate.
Flat rate:
Depending on whether you file a Chapter 7 or Chapter 13 bankruptcy, your bankruptcy attorney may set a fixed fee for filing the case.
Approval Courts:
If at any time someone thinks that the bankruptcy attorney’s requested fee is unusual and unjustified, they may seek court approval for such fee structures. Approvals can be obtained from the court for a justified amount of fees and can be paid to the bankruptcy attorney in advance or in installments as decided by the court.
Always remember to clarify your position on your bankruptcy attorney’s fees to avoid any confusion and file a favorable bankruptcy claim.
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