What to Expect With Bankruptcy Filing Fees

Many people in financial despair cringe when they realize that they must pay money in order to file a personal or business bankruptcy case. With only a few exceptions, you generally must pay a modest sum of money to declare bankruptcy. Remember that any type of debt relief requires people to handle paperwork on your behalf. Also, the fees you pay partially subsidize the major costs of operating bankruptcy courts including paying personnel.

Fortunately, the fees to file a case are usually pretty low. As of 2013, the filing fees for a personal or business Chapter 7 case are $306. Chapter 7 is the most complete type of bankruptcy in existence; if you file your case properly a judge should forgive most of your personal or business debts.

Another common type of case is Chapter 13; this type of debt relief creates a partial repayment plan and is only suitable for personal debts. The filing fees for Chapter 13 are $281. If you need to partially repay business debts or a combination of personal and business obligations, you can instead file Chapter 11. However, it costs $1,213 plus attorney fees to file Chapter 11. Usually Chapter 11 is only appropriate for entrepreneurs who want the freedom to try to save their businesses while partially repaying creditors.

You do not need to hire an attorney to file Chapter 13 or a personal Chapter 7 case. You must hire an attorney to file a corporate Chapter 7 case. Attorney fees vary depending upon your state of residence, the complexity of your case, and the expertise of your chosen legal counsel. Hiring a bankruptcy lawyer can cost anywhere from a few hundred to a few thousand dollars. People with significant personal or business assets to protect usually choose to hire legal help rather than navigate the court system without any assistance.

If you cannot afford to pay the filing fees, you can apply for an installment payment plan or a fee waiver. Generally, fee waivers are only granted if your annual income falls below the poverty level for your state. Bankruptcy courts and attorneys cannot accept checks, credit or debit cards for payment. Cash is usually the best way to handle bankruptcy-related transactions, but always get a receipt. A judge will not finalize your bankruptcy request unless your fees are fully paid or you were granted a fee waiver. Likewise, attorneys will not represent your interests until they receive the compensation they require.

Credit Score Resources