Cost of Chapter 13 Bankruptcy

The cost of filing for Chapter 13 bankruptcy varies with the complexities involved in the debtor’s financial situation. The cost typically involves the Chapter 13 bankruptcy filing fees and the fee payable to the attorney representing the debtor in the Court.

The fees charged by the court include the filing fee and the administration costs. These fees have to be submitted if the Court has to provide for a hearing. In the absence of the fee payment, the petition will get dismissed. The courts charge $235 as the filing fee and $39 as the miscellaneous administrative cost. These costs have to be met by the debtor. The fee payment is the same irrespective of whether the petition is a single petition or a joint petition. However, circumstances may arise wherein the debtor will be granted with an extension by the Court offering him the option of meeting the cost of filing as well as the administrative costs in installments. The number of payment options does not extend beyond four with the final settlement to be made not beyond 120 days of filing the petition under Chapter 13 bankruptcy. The settlement of the last installment can be extended under certain defined situations, provided the last installment is paid no later than 180 days after filing the Chapter 13 petition.

The cost of Chapter 13 bankruptcy also includes the fees for bankruptcy attorney. Though they may offer you with an initial free consultation, any further assistance calls for fee payment. The fee structure varies with the complexity of the financial situation of the debtor. The attorney may demand an upfront fee that can vary from $500 to 1,000; further costs will be charged on per-hour basis.

A debtor can trim the cost of attorney by getting himself prepared for the various procedures depending on the legal clauses. For example, while some states do not demand the presence of the attorney during the meeting with the creditors, in states like Massachusetts, the law demands otherwise. It is, therefore, essential to check out the fee structure of the attorney and the law governing them before seeking professional services.

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