Bankruptcy - Attorney Fees & Costs

BANKRUPTCY: Attorney Fees and Costs: How much will it cost?

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Q. What does it costs to file a bankruptcy case?

A. The costs and expenses of filing a bankruptcy can be divided into two primary areas as follows:

i. Court Filing Fees: The court charges a fee for the filing of the case. For a Chapter 13, this fee is $310.00 (Northern District of Georgia in August, 2015). For a Chapter 7, this fee is $335.00 (Northern District of Georgia in August, 2015) The court also charges fees for the filing of some additional documents or procedures during the course of the bankruptcy case. For example, the court now charges $30.00 to file an amendment to add a creditor(s) to your bankruptcy schedules.

ii. Other Expenses and Costs: In addition to the filing fees, you should expect to pay approximately $100 to $200.00 for the costs of other services needed in your case. These can include a credit counseling course, a credit report, a tax report, property appraisal (on-line), a financial management course, copies, travel expenses (parking/mileage), court fee for amending a case to add creditors, and some other similar case services. (Note: Some of these fees may be waived or paid over time. Ask the provider.)

Q. What are the attorney fees for a bankruptcy case?

A. If you choose to hire an attorney to handle your bankruptcy case, you will be charged attorney fees. Attorney fees vary widely from attorney to attorney in Georgia. The complexity of the case, experience of the attorney, and other factors must be considered in determining what attorney fees will be in each case. Always have those fees explained to you in detail, and always get a signed, written fee agreement.

•i. Retainer or Initial Fee: Most attorneys will charge a retainer or lump sum amount that covers the activities that are common to most cases (including initial client meeting, case investigation, preparation of bankruptcy Petition, Schedules and other required documents, client meeting to review and sign documents, filing of documents, attending Creditors Meetings, handling case administrative duties, common case motions, and similar "typical" tasks).

•ii. Additional Fees: Most attorneys will also charge additional fees if it is necessary perform services not included in the retainer. The fees for these services may be charged on an item by items basis, or on an hourly fee basis. Your written fee agreement should clearly explain the amount of the additional fees, when the fees apply and what additional fees are for. Prior to signing the fee agreement, ask your attorney if he or she expects that your case will require any "additional fee" services, and, if so, what specific services appear to be needed. From your initial interview, your attorney should be able to anticipate what many of these items will be (examples: filing Motion to Avoid Lien or handling redemption of a vehicle).

In my practice, a very high percentage of bankruptcy cases can and are handled for the amount initially charged as a retainer.

Q. How are attorney fees and cost paid?

A. How fees and case expenses are paid varies with the attorney or law firm.

  • i. Costs. Most attorneys will require that the client pay at least the initial court filing fees and related costs (credit counseling costs, credit report, etc.) prior to the filing of the bankruptcy case. On application, the court will allow the payment of its filing fee in installments in some situations. This is best reserved for emergency or dire need situations.
  • ii. Attorney fees in a Chapter 7: Contra to popular belief, bankruptcy attorneys are not rich and do want to get paid for their services. Some attorneys will "start" (but sometimes not file with the Court) a bankruptcy case for a small amount. Most attorneys will want to receive at least part of their attorney fees at the time the fee agreement is signed and some additional part of the fee prior to filing the case with the Court. Some attorneys require that all fees and expenses be paid prior to filing.
  • iii. Attorney fees in a Chapter 13: Attorney fees in a Chapter 13 case are substantially higher than the fees charged in a Chapter 7 case. There is a lot more work to do and the commitment to the client is for a much longer period of time. The only good news here is that most attorneys will allow you to pay the attorney fees through the Plan over a period of time.
  • iv. Fee Agreement: You should always have a written fee agreement which has been signed by both parties. Discuss the payment of fees with your attorney prior to signing the fee agreement, and make sure those terms are set out in the fee agreement. The payment of the fees should be clearly understood by both parties, should be something the client can actually pay AND should fairly meet the needs of the attorney to earn a living.

Q. Can I get a free consultation?

A. Yes. A free initial consultation WITH AN ATTORNEY to generally discuss your debt situation, whether you need to file a bankruptcy and what type of bankruptcy you should file is available from many law offices. The free consultation will normally be limited to a short period of time. Most attorneys will not give specific advice on potential issues in your case nor will they advise you on how to handle a case you have filed yourself. An attorney should not give you advice on a case being handled by another attorney.

In my practice, I will personally speak with you for free for up to 30 minutes on the phone or in my office about your need to file bankruptcy. Free consultations are offered on an as attorney time is available basis, and consultations in my office are available only by appointment.

Contacting the Right Attorney: Bankruptcy can be a complicated matter. The responses to these Frequently Asked Questions are general in nature, and are not intended to provide legal advice for specific cases. A consultation with a Georgia bankruptcy attorney can provide you with the information you need to determine which option best addresses your circumstances. As a solo practitioner, I am able to give more time and personalized attention to my clients. I will personally communicate with creditors or banks to resolve your issues. Your case will never be handed down to a legal assistant or other staff member.

NOTICE: The services or benefits offered are bankruptcy relief under the provisions of the U.S. Bankruptcy Code. We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.

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