When you think about the overall cost of a bankruptcy, you need to keep in mind that there are two components: the court filing fee and the attorney fee. The court filing fee is the same in every case. In Utah, the court filing fee is $335 for a chapter 7 and $310 for chapter 13.
Let’s first talk about the attorney fees for a chapter 7. In Utah, I have seen attorney fees for a 7 range from as low as $600 to as high as $2200, with the most common fees right around the $900-$1100 zone. Remember, these fees are on top of the court filing fee, so when you call around and ask lawyers how much they charge for a chapter 7 bankruptcy, make sure you understand whether the quote you are getting includes the filing fee. I charge $1265 for most of my chapter 7 cases.
Now, let’s talk about the attorney fees in a chapter 13. In Utah, unless you have an unusually complex chapter 13 case, the attorney fees are not set by the individual attorney but are actually dictated by the courts. In other words, the overall fees your chapter 13 attorney is going to get are the same in every case and it’s somewhere between $3,000 and $3,500, depending on how much you earn and how much and what type of debt you have. What is different and what varies from lawyer to lawyer in a chapter 13 is how much of the attorney fees you must pay in advance, when you meet with the lawyer.
Let me give you an illustration. Let’s say you have a fairly simply chapter 13 case and the standard attorney fee for such a case is set by the courts at $3,000. If your attorney says he charges $800 up front to file your chapter 13 case, he is going to use $310 of that to pay your court filing fees and the other $490 of that will go toward his total fees of $3,000, leaving another $2510 that you still owe him. How does he get the remaining $2510? The trustee pays the rest of his attorney fees out of the monthly bankruptcy payment you will make in your chapter 13. Some lawyers charge more up front and get paid less through your bankruptcy; others charge less up front and get paid more through your bankruptcy—either way, we all get the same amount.
I charge no attorney fees up front for a "0 Down" chapter 13--you only have to pay the $310 court filing fee and the $9.95 credit counseling fee out of pocket.
There are two other small fees you need to keep in mind when you file your case: the minor fees for taking the pre-filing credit briefing session (varies from $9.95 to $50) and the pre-discharge financial management class (varies from $7.95 to $50).