How Much Does It Cost to File Bankruptcy?
Written by True Tamplin, BSc, CEPF®
Updated on June 21, 2021
The cost of bankruptcy can vary depending on your circumstances.
In general, filing chapter 7 costs $335, about $100 in possible additional fees, and between $1,000 and $3,500 for a lawyer.
Chapter 13 costs $310 to file, about $100 in possible additional fees, and between $2,000 and $5,000 for a lawyer.
How Much Does Filing Bankruptcy Cost?
As of 2019 filing bankruptcy costs $335 for chapter 7 and $310 for chapter 13.
These are only basic filing fees, however, and you could pay about $100 for mandatory debt counseling courses or other expenses, plus between $1,000 and $5,000 for a bankruptcy lawyer.
How Much Does a Bankruptcy Lawyer Cost?
How much a bankruptcy lawyer will cost depends on your state of residence and circumstances.
In general, you can expect to pay between $1,000-$3,500 for chapter 7 and as much as $5,000 for chapter 13.
Generally the amount of money saved by bankruptcy lawyers exceeds the cost of hiring one.
How Much Does It Cost to File Bankruptcy FAQs
What is Bankruptcy?
What Is Bankruptcy? The Three Chapters of Bankruptcy
There are three common types of bankruptcy known as “chapters”in the U.S. bankruptcy code, Ch. 7, Ch. 11, and Ch. 13, each with varying criteria and consequences.
Ch. 7 Bankruptcy
The most common type of bankruptcy is Chapter 7.
Chapter 7 bankruptcy is known as “straight”or “liquidation”bankruptcy.
It is designed to give a “fresh start”by discharging debts that cannot be repaid through the liquidation of the debtor’s assets.
Upon filing Chapter 7, a trustee is appointed to sell the debtor’s non-exempt assets and distribute the proceeds to creditors.
For individuals, the law exempts certain assets such as retirement funds, primary residence, tools for their trade, and personal vehicles from being liquidated to pay back creditors.
This pays back creditors some of what they are owed and protects individuals from having all of their livelihood taken from them.
Ch. 11 Bankruptcy
Chapter 11 bankruptcy is primarily for companies, allowing them a break on paying their debts in order to restructure, come up with new terms for paying their creditors, and become profitable again.
This allows companies to stay afloat while coming up with a new way to pay back creditors.
Chapter 11 is the most complex and expensive form of a bankruptcy proceeding and should therefore be considered after other options have been explored.
Ch. 13 Bankruptcy
Chapter 13 bankruptcy, known as a “Debtor in Possession”Bankruptcy, stands in contrast with Chapter 7 because it allows the individuals to keep from liquidating their property.
Chapter 13 creates a new, more affordable payment plan for the debtor to repay creditors, usually lasting 3 to 5 years.
Once the payment plan is finished, the remaining unsecured debts are discharged.