If you are overwhelmed by your debts and want to get rid of them to regain control of your life, then you should probably consider filing for bankruptcy to do so. Bankruptcy is a legal solution that will eliminate most of your debt, giving you the opportunity to rebuild your finances from the ground up. However, there is something you should consider before you proceed with your filing: bankruptcy is not free, it cost to file for bankruptcy.
To file for bankruptcy, you will have to pay for things like court fees, credit counseling fees, and of course, attorney fees. The costs will depend directly on your specific case and the chapter of bankruptcy you wish to file. If you are thinking about filing for bankruptcy, chances are that you are in a critical financial state, so the smartest thing to do is to plan your budget carefully before you file.
However, one of the essential investments you will make during your bankruptcy filing is to hire a bankruptcy attorney to help you navigate through the process successfully.
When filing for bankruptcy, one of your top priorities should be to work with a committed and dedicated bankruptcy lawyer who is always available to you. California is home to many bankruptcy law firms that are eager to help you navigate through the entire process and satisfy all of your legal needs. Most of them offer completely free initial consultations, so don’t hesitate to contact them to find the right attorney for your case.
Bankruptcy filing fees
As of 2021, the cost set by the U.S. Court for filing a Chapter 7 bankruptcy is $245. Furthermore, upon filing, you will have to pay $75 in administrative fees and an extra $15 for the bankruptcy trustee. Besides, if you want to reopen a Chapter 7 bankruptcy filing you must pay another $260.
On the other hand, the U.S. Court set the price for Chapter 13 bankruptcy at $310. Similarly, when you file for bankruptcy you will have to pay $75 in administrative fees. In this case, it would cost you $235 to reopen a previous filing.
These are the basic bankruptcy filing costs, you may incur additional expenses in your case, such as changing your bankruptcy case from Chapter 13 to Chapter 7.
Attorney fees
Attorney fees vary from state to state, case to case, and district to district. The complexity of your case and where you live will greatly affect the cost of your bankruptcy filing.
A study by the American Bankruptcy Institute using data from 2005 to 2009 found that the average cost of Chapter 7 bankruptcy nationwide was $1,079. Nowadays, the average cost of attorney’s fees for a Chapter 7 bankruptcy filing in the state of California is about $1,650.
On the other hand, the American Bankruptcy Institute study determined that the national average cost of a Chapter 13 bankruptcy was about $2,560. In California, the average fees range from $3,300 to $5,000 depending on your accumulated debts.
Credit counseling costs
One small fee you should not forget is the amount you will have to pay for credit counseling courses. This is a requirement that every petitioner must meet before receiving a debt discharge, and it usually costs around $50.
Look for attorneys who offer payment plans
You may be asking yourself, “How can I afford to pay an attorney if I don’t even have the money to pay my debts?” This is a fairly legitimate concern, and here’s the solution: many Los Angeles bankruptcy attorneys offer affordable payment plans for both Chapter 7 and Chapter 13 filings.
Most law firms in the area offer free consultations. You can take advantage of this consultation to inquire about the plans each attorney can offer you, so you can find the one that best fits your budget. Don’t waste any more time and get started on your path to a fresh financial start.