Paying Your Bankruptcy Lawyer: Costs & Types of Fees

Learn when most attorneys require payment, how attorneys' fees are structured, the average costs, and whether fees are fixed by the court.

If you’re thinking about hiring a lawyer to file a bankruptcy petition and represent you, you’ll have to pay attorneys’ fees. Most bankruptcy lawyers charge a flat fee for a simple bankruptcy; others charge an hourly fee. When you pay attorneys’ fees will depend, in large part, on whether you file for Chapter 7 bankruptcy or Chapter 13 bankruptcy.

Read on to learn about attorneys’ fees in both Chapter 7 and 13 bankruptcy.

Flat Fees Versus Hourly Fees

Many attorneys, especially bankruptcy attorneys, will charge a "flat rate" to represent you in a bankruptcy case. You’ll pay a fixed amount for the attorney to represent you, regardless of the amount of time the attorney spends on your case.

Other attorneys will charge you an hourly rate, although it’s uncommon in consumer bankruptcy cases. The more likely scenario is for the attorney to charge a flat fee for the bulk of the matter. The lawyer will charge an hourly fee for any extra work required for services like defending against an objection to discharge. Your contract should spell out what the flat fee covers.

Average Chapter 7 Bankruptcy Attorney Fees

Most Chapter 7 bankruptcy attorneys will base their fees on how complicated your case is and what other attorneys in the area would charge for a similar bankruptcy. If you have a lot of assets or debt, you might pay more than an unemployed person with no assets.

In general, attorney fees for a Chapter 7 bankruptcy range from $1,000 to $3,500 depending on the complexity of the case. Larger firms with more advertising and overhead costs sometimes charge more than a solo practitioner, but not always. Some larger operations offer low fees and count on a higher volume of cases. Also, you might find a solo practitioner will cost more but offer more personalized service. It will depend on the office.

You can expect a newer attorney to charge less than a more experienced lawyer, and if your case is a simple Chapter 7, you might not need an attorney with years of experience. Keep in mind, however, that bankruptcy is a specialized area of law and that most attorneys who don’t regularly practice bankruptcy won’t accept a bankruptcy case.

When shopping around for a bankruptcy lawyer, call at least a few attorneys in your area. Compare their fees and ask if bankruptcy is an area they specialize in, as well as the number of cases they file each month.

Find out more in What to Look for in a Bankruptcy Lawyer.

Paying a Chapter 7 Attorney

You’ll pay your Chapter 7 attorneys’ fees in full before the attorney files the case—and with good reason. Chapter 7 wipes out most unsecured debt in a Chapter 7 case, including attorneys’ fees. So if you had a balance due when filing the matter, it would get discharged. Chapter 7 attorneys know this, of course, and require full payment.

Learn how to find a bankruptcy attorney.

Average Chapter 13 Bankruptcy Attorney Fees

Most courts have guideline “acceptable” fees for a Chapter 13 bankruptcy. Unless exceptional circumstances justify it, an attorney won’t be allowed to charge more than the court’s guideline fee.

Chapter 13 guideline fees are different for each judicial district. However, they are typically between $2,500 and $6,000 depending on the complexity of the case. For instance, if you own a business, the case will likely require more work and justify a higher fee.

Paying a Chapter 13 Attorney

Fortunately, most attorneys don’t require you to pay the entire Chapter 13 bankruptcy fee upfront. In most cases, attorneys will ask for a portion of their fees before filing your matter, and the remainder will get paid through your Chapter 13 repayment plan. How much a bankruptcy lawyer will require before filing will depend on each attorney or firm. But on average, you can expect to pay about half of the total fee before the attorney files your case.

Lawyers Must Disclose Attorneys’ Fees to the Court

Attorneys’ fees in bankruptcy cases are somewhat unusual in that they must be disclosed to and approved by the court. However, this doesn’t mean that the bankruptcy court fixes the amount that attorneys can charge in bankruptcy cases.

Attorneys are free to charge what is reasonable given their experience and the complexity of your case subject to review by the court. Some courts have a “presumptive” maximum fee for certain types of bankruptcy cases, but the attorney can overcome the ceiling by demonstrating a good reason for charging more.

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