You’ve considered hiring a bankruptcy attorney, but you aren’t sure how you’ll pay her. After all, you have plenty of other financial obligations on your plate. You do have the decision to handle the case on your own, but the intricacies of bankruptcy law can be overwhelming. Therefore, it is best to have your own representative counsel. If you’re wondering how you can pay a bankruptcy attorney to help with your Chapter 7 or Chapter 13 case, read on.
Chapter 7 Bankruptcies
Are you hiring a lawyer for a Chapter 7 case? You’re in luck; the costs associated with Chapter 7 bankruptcy counsel are pretty low. The filing fee, which goes to the county clerk, is $335.00. You can expect the attorney fee to be around $1,500. Regardless of how you file for bankruptcy, you’ll have to undergo credit counseling before your case is filed and again before it is finished. Together, both sessions can cost you between $40 and $100.
If you are in a dire situation, ask your attorney if you can work out a payment plan or request a fee reduction. People who are beneath the federal poverty line are typically eligible to have their filing fees and credit counseling fees waived. In many situations, bankruptcy lawyers will allow you to pay your attorney fee in installments; however, they won’t begin working on your case until you have paid in full.
Chapter 13 Bankruptcies
When someone files for Chapter 13 bankruptcy, they set up a payment plan to repay their debts to creditors. They handle their lawyer fees the same way. Many bankruptcy attorneys bundle their fees into their client’s payment plan, which is repaid over the course of three to five years. In that case, your first payments will likely go to your lawyer fees before your other debts. The standard Chapter 13 case has a lawyer fee of around $3,000.
In some instances, your bankruptcy attorney will allow you to file a Chapter 13 to pay your lawyer fees, then convert your file to a Chapter 7. Don’t rely on this trick to get your fees out of the way; not all bankruptcy courts allow you to convert your case, as switching from a Chapter 13 to a Chapter 7 makes more work for the courts. Since it also makes more work for the bankruptcy attorney, she’ll likely charge you more than she would a client with a regular Chapter 7 case.
Alternatives to Bankruptcy Lawyers
Although a bankruptcy lawyer is well-versed in the practices, court regulations, and heaps of paperwork associated with bankruptcy law, hiring one is expensive. If you don’t think you can pay for a bankruptcy lawyer, you don’t have to. If you have a Chapter 7 case, you can file on your own. Many attorneys and bankruptcy courts provide free legal clinics to low-income debtors. You can also seek help from an attorney who takes on pro-bono cases.
