Although the cost to hire a Chapter 13 bankruptcy attorney can vary by district and state, the good news is bankruptcy courts have guidelines which allow them to review and approve fees. Chapter 13 bankruptcy lawyers also must disclose the fees they charge, and the court has the authority to decide whether or not the fees are unreasonable. In some cases, if the court determines the fees paid have been too high, they will also make the lawyer return all or a portion of the bankruptcy fees.
When will the court review the bankruptcy fees?
Although review of the bankruptcy fees are permitted, if the lawyer follows the fee guidelines established by the court, the court will generally not review the fees. For example, if the bankruptcy lawyer charges a fee within the range of what the court concludes is presumptively reasonable, the court will not review the fees. The guidelines, therefore, kind of act as a fee limit because many lawyers will make sure their charges do not exceed the guidelines expressly to avoid a court review.
Due to the complexity of some bankruptcy cases, however, a bankruptcy lawyer does have the ability to charge more, especially if they determine the case will take a high number of hours to complete. In this case, the bankruptcy lawyer may have to provide the court with information on why the higher fee is justified.
Chapter 13 bankruptcy fees
The most efficient way to find the fee guidelines for your district is to review your districts bankruptcy court website. You can also contact your local bankruptcy court. For general information about bankruptcy you can also review the United States Courts website at: www.uscourts.gov/FederalCourts/Bankruptcy.aspx
As mentioned above, the complexity of the bankruptcy case will determine the costs, but Chapter 13 bankruptcy lawyers generally charge anywhere from $2,500 to $3,500, but costs could be as high as $4,000 for more complicated cases.
Can I pay bankruptcy fees through my plan?
All or part of the Chapter 13 bankruptcy fees and expenses to hire a bankruptcy attorney can be paid through the bankruptcy plan. The amount allowed to be financed through the plan will vary by district.
For example, some districts allow the entirety of the fee to be paid through the plan while other districts allow only a portion of the amount to be paid through the plan. Talk to your bankruptcy lawyer about the rules and regulation in your state.
Do I really need a bankruptcy lawyer?
Hiring legal help, is it a waste of money or critical to the successful completion of the bankruptcy process? It depends, if you have a simple, Chapter 7, no-asset bankruptcy case and time to learn the rules of the court, file it on your own. Other more complex cases will be difficult to complete without legal help.
Talk to several bankruptcy lawyers in your area. Bankruptcy is a serious decision. A good lawyer will tell you if it is really necessary and provide other solutions which could provide a better way to reach financial solvency.
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