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Bankruptcy Law Blog

Friday, August 31, 2018

How Much Does It Cost To File For Bankruptcy? Chapter 7 vs. Chapter 13

One of the things a lot of our clients find frustrating is that filing for bankruptcy is not free. It seems to them that the government should understand that the people who are filing do not have extra money to spare. We understand this, which is why we work with our clients to make sure they can afford the legal help they need.

How much it will cost to file for bankruptcy depends on what chapter of the bankruptcy code you file under, and how complex you case is. There are three things every person who files for bankruptcy must pay for: credit counseling, court fees, and attorney fees.

Credit Counseling

Anyone who wants to file for bankruptcy has to go through credit counseling not more than 180 days before they file. The would-be filer works with a credit counselor to put together a list of all income, assets, and debts. The counselor then crafts a budget and advises the debtor whether or not it is possible to get out of debt in a reasonable amount of time without filing for bankruptcy.

The credit counselor can charge a reasonable fee for their services, which usually ranges from $10 to $25. However, if a debtor cannot afford the fee, the counselor must provide their services for free or at reduced rates.

Click on the following links to see the lists of Bankruptcy Administrator approved credit counselors in Northern Alabama, Middle Alabama, and Southern Alabama. Only providers on these lists should be used.

Court Fees

Filing a lawsuit is never free. The government always charges a fee. In bankruptcy cases, the fee varies based on the type of case filed. It costs $335 to file a Chapter 7 case and $310 to file a Chapter 13 case.

The $335 fee charged in Chapter 7 cases must be paid up front. The $310 fee charged in a Chapter 13 case can be paid in monthly installments.

Attorney Fees

How much our firm charges depends on the complexity of the case, which dictates how much time we must devote to working on it. An attorney in our office will review your case at your free initial consultation with us to determine the amount the firm will charge.

In Chapter 7 cases we must be paid up front, just like the court fees. In Chapter 13 cases there are no attorney fees due up front because we get paid in monthly installments just like other creditors. We do accept partial payments.

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Padgett and Robertson assist clients with Bankruptcy, Personal Bankruptcy, Consumer Bankruptcy, Chapter 7 Bankruptcy, Chapter 13 Bankruptcy and The New Bankruptcy Law in Mobile, Alabama and throughout southern Alabama. Alabama State Bar Association Regulations require the following: "No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers." 11 U.S.C. 528 of the U.S. Bankruptcy Code requires the following: "We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”



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Alabama State Bar Association Regulations require the following: "No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers." 11 U.S.C. 528 of the U.S. Bankruptcy Code requires the following: "We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.”