Our Bankruptcy Attorney Blog

When filing bankruptcy there are many things that should be taken into consideration before doing so. This is why it is important to not wait until you are absolutelyIf  destitute to file for bankruptcy. Although most of the associated fees can be waived by the court, this becomes a whole legal process in its own right, before you can even file your basic petition for bankruptcy protection. On average, the normal amount that individuals spend to file for bankruptcy is between two and five thousand dollars. While all of this can be waived or avoided, the result is frequently a disaster for those that attempt to do so.

As a matter of law, before you are allowed to file for bankruptcy at all you have to receive credit counseling from a government-approved credit counseling agency 180 days or less from the date of the filing. These credit reporting agencies review your overall financial situation and determine whether or not bankruptcy is the right option for you. Assuming they decide that bankruptcy is a good option, they then issue you a certificate confirming that you received the counseling services. This certificate has to be filed with your bankruptcy petition and failure to do so guarantees that your petition will be flatly rejected from the outset. Although most of these credit counseling agencies are non-profits, most of them still charge basic fees for the review and for the certificate, and obviously these fees have to be paid up front.

After you have your certificate, you have to keep in mind that the bankruptcy process itself has a flat fee: $299 for a Chapter 7 filing or $274 for a Chapter 13 filing. Technically speaking, these fees can be waived by the court under the forma pauperis process, but this involves filing a separate set of forms and being able to document the claims contained therein. Further, generally speaking the courts rarely waive the fees altogether. Most of the time the court will simply impose a payment plan that allows the petitioner to pay the filing fee over installments instead of all at once. Even when the court decides to waive the fees, frequently it will only waive a portion of them, not all of them. Today, it is exceedingly rare to see anyone have all of their fees waived by the court.

Finally there is the big question of whether or not to hire a bankruptcy attorney to represent you. Debtors are allowed to represent themselves and present their petition to the court pro se, but this is almost always a bad idea. Quite simply, bankruptcy law is extremely complex and the courts are exceedingly bureaucratic, meaning that everything has to be filed properly or the whole case is simply denied and thrown out. Further, there are now restrictions on when a person can re-file their case if they have had a previous one thrown out for some technical reason. If you literally own absolutely nothing and have no real hope of acquiring anything in the foreseeable future, a pro se case may be worth the effort. Anyone that owns property, especially complicated property like real estate, should seriously consider hiring a bankruptcy attorney. Failure to do so can result in either failing to get the full benefit of the bankruptcy (despite getting the full downside) or can even result in a total financial disaster.

Tags: bankruptcy fees

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