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Is Filing For Chapter 7 Bankruptcy Expensive?

New data from the United States Courts shows that for the 12-month period ending June 2017 there were 489,000 Chapter 7 bankruptcies filed in the nation. With so many individuals filing for bankruptcy, you may wonder if cost is a barrier to doing so. As in all legal matters, the cost of filing for bankruptcy will depend on the complexity of your case.

How Much Does It Cost To File Chapter 7?

A typical price range for a Chapter 7 case is $500 to $2,200, with the average being $1,200 to $1,500.

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Before your attorney files your case, it’s most likely that you’ll be required to pay any balance you owe your attorney, because all debts (including those to your attorney) will be discharged once the case is filed. Needless to say, your attorney understands this and has every intention of being paid for their efforts. If you don’t have the money to pay up front, your proceedings may be delayed until you are able to pay. Therefore, it is a good idea to consider what costs are involved in a Chapter 7 bankruptcy filing and what factors may cause those costs to fluctuate.

Does Income Affect The Cost Associated With Filing?

You may be charged a higher fee if any of the following pertain to your income:

  • Your income is higher than the median income for your state
  • Your income comes from multiple sources
  • You have a retirement account or pension plan
  • Your case is classified as an asset case where funds will be distributed to creditors
  • You have equity in your assets such as a car or home
  • You choose to keep more property than your state will allow you to exempt

According to a survey conducted by, survey participants who lived in households with $6,000 or more in monthly income reported attorney’s fees $300 higher than the average amount paid.

An Accumulation Of Financial Troubles Translates To Higher Fees

It’s relatively easy to find yourself in a tough financial situation. You might have several credit cards that you can’t pay, or maybe you have medical bills that have piled up. These are very common reasons why you might seek to file for bankruptcy. However, if you have financial problems in other areas, your case will start to get complicated. That, in turn, will increase your fees. Some of the situations that could drive up the complexity of your case and increase your fees include:

  • Having a large number of creditors
  • Having filed for bankruptcy in the last eight years
  • You wish to stop a legal action such as a wage garnishment, eviction notice or bank levy
  • Liens have been filed against your property
  • Being involved in litigation
  • Anticipation that you may be charged for fraudulent activity, such as using credit cards without the intention of paying back your debt
  • Having debts you can’t discharge in bankruptcy, such as federal student loans or tax debts

Typically, the amount of debt you have does not affect the fees you pay to file your case. However, any of the above situations will have an impact on the amount you pay and the costs could be significant.

Personal Issues Will Affect The Related Costs

When filing for Chapter 7 bankruptcy, take into account your personal situation. Certain factors regarding Attorney and clientpersonal issues can complicate your case enough to warrant higher fees. Some of these situations are:

  • You are separated or going through a divorce
  • You are required to pay child support, alimony or payments for division of property
  • You have a tumultuous relationship with an ex-spouse or ex-business partner

Maybe you aren’t affected by any of these issues. If that’s the case, you can expect your fees to be straight-forward. But as you face more issues, expect the fees to increase with each problem that you are confronted by, because it adds to the legal complexity. If nothing else, that adds to the time and effort required of your attorney.

Other factors that can affect your fees include where you live and the experience of your attorney. It is best to consult with an experienced attorney who can answer your questions and walk you through the process.

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