When you think about the overall cost of a bankruptcy, you need to keep in mind that there are two components
- The court filing fee is the same in every case. In Utah, the court filing fee is $306.00 for a chapter 7 and $281.00 for Chapter 13.
- The Attorney Fees
Chapter 7 Attorney Fees
Let’s first talk about the attorney fees for a chapter 7. In Utah, I have seen attorney fees for a 7 range from as low as $600 to as high as $2200, with the most common fees right around the $900-$1100 zone. Remember, these fees are on top of the court filing fee, so when you call around and ask lawyers how much they charge for a chapter 7 bankruptcy, make sure you understand whether the quote you are getting includes the filing fee. Most lawyers I know, including myself, include the court filing fee when they tell potential clients how much the bankruptcy is going to cost.
Chapter 13 Attorney Fees
Now, let’s talk about the attorney fees in chapter 13. In Utah, unless you have an unusually complex chapter 13 case, the attorney fees are not set by the individual attorney but are actually dictated by the courts. In other words, the overall fees your chapter 13 attorney is going to get are the same in every case and it’s somewhere between $3,000 and $3,500, depending on how much you earn and how much and what type of debt you have. What is different and what varies from lawyer to lawyer in chapter 13 is how much of the attorney fees you must pay in advance, when you meet with the lawyer. Let me give you an illustration. Let’s say you have a fairly simply chapter 13 case and the standard attorney fee for such a case is set by the courts at $3,000. If your attorney says he charges $800 upfront to file your chapter 13 case, he is going to use $274 of that to pay your court filing fees and the other $526 of that will go toward his total fees of $3,000, leaving another $2474 that you still owe him. How does he get the remaining $2474? The trustee pays the rest of his attorney fees out of the monthly bankruptcy payment you will make in your chapter 13. Some lawyers charge more up front and get paid less through your bankruptcy; others charge less up front and get paid more through your bankruptcy—either way, we all get the same amount.
There are two other small fees you need to keep in mind when you file your case: the minor fees for taking the pre-filing credit briefing session (varies from $25.00 to $100.00) and the pre-discharge financial management class (varies from $11.00 to $50.00).
What Do I Charge?
Wondering what I charge? I actually have two ways to pay for a chapter 7 and I explain it all on this page here. In chapter 13, unless you have an extraordinarily complex case, I only charge $550 down. In either a chapter 7 or 13, my fees include the cost of pulling your credit report from all three bureaus. My fees do not include the costs of the online classes you have to take, but I have found providers of these classes that I think are the very lowest around.