How Much Do Bankruptcy Lawyers in New York City Charge?
Filing for bankruptcy gets a bad reputation. The credit industry has spent a lot of time, and much more money, lobbying to make personal bankruptcies appear to be the worst thing people can do. Once you learn about the benefits of filing for bankruptcy relief, however, you will likely realize that bankruptcy protection may be the best thing you can do for your financial health if you are struggling with debt.
What are some benefits of declaring bankruptcy?
For one, the whole purpose of a bankruptcy protection is to give debtors a financial fresh start. The Bankruptcy Code allows gives debtors immediate debt relief, and the discharge of all types of debts – from credit card debt and medical debt to tax debts and debt consolidation loans – and puts you in a great position to get a fresh start.
With debt in the rear view after your case, and household income freed up, many people experience an increase in their credit after bankruptcy. As a result of all these benefits, it would be a good idea to start your bankruptcy case as soon as you can.
Does Filing Bankruptcy Immediately Stop Creditors From Collecting Debts Against Me?
Personal bankruptcies are legal proceedings designed to help people who have a difficult time paying their liabilities experience debt relief and receive a financial fresh start. Since many people thinking about filing consumer bankruptcy are experiencing harassment from both unsecured creditor and secured creditors alike, or they may even be dealing with a wage garnishment or foreclosure, bankruptcy protections can be super helpful when creditor harassment feels non-stop.
When a case is filed, the Bankruptcy Code directs that an Order for Bankruptcy Relief (also known as the Automatic Stay) goes into effect immediately. Not only is debt collection stayed, but most litigation will also be stayed. At the end of your case, after it has been administered, you get the power of the discharge of debts, which prohibits an unsecured creditor as well as secured creditors from attempting to collect those debts against you personally relief.
Before you decide to file for bankruptcy protection, however, you may want to get an overview of bankruptcy for you, including what your case may look like, including costs. The best and easiest way to get this done is to speak with some bankruptcy lawyers.
How Much Does Filing a Bankruptcy Cost?
If you are in financial distress and looking for a way to dig out, one question you may have is: what does it cost to file for bankruptcy relief? The answer is not simple, since it depends on several things. There are different parts to the total cost of filing personal bankruptcies, which we’ll explore below.
Different Costs for Different Chapters
There are different filing fees for each of the different bankruptcy chapters. (In this article, we’re limiting the focus to consumer chapter 7 and chapter 13 cases. Bankruptcy for business tends to be a significantly different kind of case, for which many lawyers will require large retainers to take.)
At the time this article is published, the cost of filing a consumer petition for bankruptcy under chapter 7 in court is $338. The filing fee for a chapter 13 consumer bankruptcy petition is $313.
The bankruptcy filing fees are due at the time you file your case with the court. If you need time to pay the fees, you can file an application to pay the bankruptcy filing fees in monthly payments over time (4 months total).
If you cannot afford to pay the filing fees in installments, you can file an application to have the filing fee waived. The application will require you to disclose more information, including listing your personal property (like cash, bank accounts, cars, etc.), income and expenses, as well as a statement explaining why you cannot afford to pay the filing fee.
Credit Counseling and Debtor Education Courses
In addition to the case filing fee as one of the costs bankruptcy filers will incur, another cost is for the credit counseling and debtor education courses. Broadly speaking, the courses are intended to give debtors awareness as to how their income has been used in the past, and a plan to better manage their money in the future. (I tell my clients that they are like budgeting and financial planning courses.).
The credit counseling course must be completed BEFORE your file your bankruptcy forms with the court (unless you qualify for an exemption). The certificate of completion you are issued is filed with your petition and schedules.
The debtor education course must be completed, and certificate of completion filed with the court, before the bankruptcy discharge is entered. If you don’t complete these courses and file the corresponding certificate in a timely manner, your case may be dismissed. A dismissed bankruptcy case means you lose the protection of bankruptcy – creditors can once again continue to harass you, and you remain liable for your debts.
The credit counseling and debtor education courses must be completed using a credit counseling services agency approved by your bankruptcy court. A list of approved providers should be found by visiting your bankruptcy court website.
Fees for the courses vary, depending on the credit counseling services agency. I have seen providers charge as low as $9.76 for each course, while others charge $35. The cost to complete the courses online is generally cheaper than completing the courses over the phone.
How Do You Know if I Qualify for Bankruptcy in New York City?
If you are thinking of filing for Chapter 7 bankruptcy it is very important that you know if you qualify. In New York State, the way that bankruptcy laws that apply to one individual may not apply to another. A bankruptcy lawyer can help you determine if you qualify for Chapter 7 bankruptcy and what you can expect during the filing process. You should know that it is possible to file for Chapter 7 bankruptcy even if you have already filed a previous bankruptcy case. You do not need to worry, however, as a previous case will not disqualify you from filing a second time.
The first thing to know is that bankruptcy is not a decision to make lightly. It’s worth your time to consider your options, including debt management plans or negotiating your unsecured debt, before you make a final decision. Sometimes, you can try calling an unsecured creditor and try working out a flexible payment plan for that unsecured debt. Bankruptcy filings may often be the right choice, however, for people owing at least $10,000 in unsecured debts, such as credit cards, medical bills, and personal loans, and you are having difficulty paying the debt.
Many of the issues that determine whether someone qualifies for bankruptcy in New York State can be figured out in a quick conversation with a New York Bankruptcy Attorney. Things like family size, income, expenses, and assets will usually be enough to make a preliminary determination whether you qualify for bankruptcy in New York City. Here are a couple of suggestions to keep in mind when researching a bankruptcy law firm.
Contact Different Bankruptcy Attorneys
Being unable to pay your debts can be very stressful, especially if you are worried about being sued by your creditors or, even worse, you have already been sued and you are being threatened with a wage garnishment or bank levy. If you do not have the money to pay your debts, or you have already tried to pay your debts but creditors won’t accept your payments, you may be considering bankruptcy as an option.
The first step is to contact different bankruptcy lawyers. Check out their websites for information. Send an email to get more information. Call their office to get a sense of how it’s like to work with them. If you can get a sense for the bankruptcy attorney fees, even better.
Look for Bankruptcy Lawyers You Feel Comfortable Working With
Before you hire a bankruptcy lawyer, you should make sure that you feel comfortable working with the one you choose. Consider what you want to get out of your bankruptcy case and then look for a lawyer who can realistically help you achieve your goals. It’s also a good idea to speak with more than one attorney, if possible. Some attorneys will spend a lot of time on the initial interview, while others may not spend as much time with you.
Bankruptcy cases require revealing a lot of information that you may not have ever shared before. Competent bankruptcy lawyers in New York City will ask you questions to get a sense of what the overall picture of the case is. Questions may include:
- questions about work history
- questions about marital history and family
- questions about shopping habits and purchases
- questions about income and expenses
Since these questions are very intimate, you want to feel comfortable with the person you are sharing that information with.
What Are the Benefits of Hiring a Bankruptcy Lawyer in New York City?
Bankruptcy cases come in different shades of complexity. There are also many procedural requirements that, if you mess up on, can cause problems in a case that may lead to dismissal, loss of property, and so on. This is why when doing your bankruptcy evaluation, you want to balance finding an affordable bankruptcy attorney, someone that is an experienced attorney that keeps up with and regularly practices bankruptcy law, and is someone that you feel comfortable and confident working with.
There are stories of people hiring bankruptcy petition preparers. These are not attorneys, and often paralegals or law office assistants that will offer to prepare your case for a really low fee. Keep in mind that bankruptcy petition preparers are not authorized of giving you legal advice, they have no duty to represent or indemnify you, and if something goes wrong in your case, it’s your problem entirely.
There are also lots of bankruptcy stories I’ve seen have a bad ending when someone filed their own case. They didn’t understand how the federal bankruptcy exemptions or state bankruptcy exemptions work, and end up losing non-exempt property.
For instance, someone may have a claim for personal injury (because they were involved in a car accident or something similar), but have not filed a lawsuit yet. Keep in mind that the potential claim for personal injury is an asset – not the actual filing of a complaint in court. If not properly accounted for in bankruptcy proceedings, the trustee can seek to take over the claim for personal injury, or the person may lose out on money they were expected to receive in the case.
Another common occurrence involves real estate. People not represented by counsel may not properly disclose a prior or current interest in real estate. At the meeting of creditors, the bankruptcy trustee brings up a transfer of real estate that the debtor was part of, and it may be a fraudulent transfer.
Or there are times when objections from a creditor’s counsel (whether for unsecured debt or a secured claim) are filed in that person’s case, and they have no idea how to defend against the objections in bankruptcy litigation.
Hiring a bankruptcy lawyer in New York City may seem impossible when you have trouble paying your bills, but these examples highlight some of the reasons why it’s worth it to hire a bankruptcy firm to handle your case, even if it seems like an average bankruptcy. Bankruptcy proceedings can be unforgiving when you are not familiar with how it works.
When you hire an experienced bankruptcy law firm you get the assurance of someone being able to represent you confidently and competently in the bankruptcy court for your district. You get the confidence that you are not missing any time limits or other procedural requirements. Also, you can hold the lawyer accountable if something goes wrong.
What types of questions should I ask bankruptcy lawyers in New York City?
There are many questions you should ask a bankruptcy lawyer before you hire them, not only to make sure you are getting the best legal advice possible, but also to make sure you know exactly what to expect during the bankruptcy process. Here are some common questions you may want to keep in mind when looking into legal services:
The first step in deciding whether to file for bankruptcy is to find out how much of your debt, whether to unsecured creditors or secured creditors, is actually dischargeable in bankruptcy proceedings. Certain debts, like debts related to student loans or child support, are generally not dischargeable in bankruptcy cases.
Another common reason people look to file bankruptcy is because of business debt. Keep in mind, however, that a business entity is not entitled to a discharge of debt in chapter 7 cases, nor are business entities able to file chapter 13 bankruptcy.
If you are considering filing for bankruptcy, but are unsure whether it is the right thing for you to do, contact a New York bankruptcy attorney immediately for a free consultation. Having an experienced bankruptcy law firm guide you through the process will ensure that you move forward in the right direction, and you will avoid making costly mistakes. Some other questions you may want to ask include:
- can I keep my car?
- can I keep my house?
- can I keep the money in my bank accounts?
- can I keep my tax return refund?
- what if I owe child support?
- what happens to my student loans if I file bankruptcy?
- how long does the case take?
- how long after bankruptcy can I start rebuilding my credit?
What Price Can I Expect to Pay a Bankruptcy Lawyer in New York City?
Bankruptcy is a serious matter that should not be taken lightly. When you decide to file bankruptcy, there are a lot of questions you’ll want to ask your lawyer to help ensure that you get the best possible representation.
Your first question may be, “How much will it cost?” The cost of bankruptcy services in New York City vary greatly and will depend on the number of assets you have, the complexity of your case, and other factors. The cost of bankruptcy should not be the most important consideration when you decide to file. However, it is important to know how much you will have to spend before you make your decision because bankruptcy costs are non-refundable.
While hiring an attorney is almost always the best way to deal with legal problems, the cost of legal services is often a barrier to people seeking legal help. Many people don’t realize that their local bankruptcy lawyers may charge much less for legal services than other types of lawyers.
To hire a bankruptcy lawyer in New York City, many attorneys charge somewhere around $1,500 to $2,500 for a Chapter 7 bankruptcy, and between $3,000 and $5,000 for a Chapter 13 bankruptcy. The amount you pay will depend on any number of factors, which is why it may be worth the effort to speak with multiple bankruptcy law firms. Some of the best ways to find a bankruptcy attorney that you want to work with include:
- asking family or friends for recommendations;
- searching online reviews and forums
What if I have previous bankruptcy filings?
Having a previous petition in bankruptcy shouldn’t really impact how much a lawyer charges for a case. For chapter 7 cases, if the applicable time has passed since your last bankruptcy filing, then a prior case should not impact your fee.
In chapter 13 bankruptcy cases, previous filings may definitely increase what a bankruptcy attorney charges. During the height of the foreclosure crisis, many people turned to filing chapter 13 to stop a foreclosure sale. Since these cases were often filed by the homeowner themselves, they were eventually dismissed since many homeowners did not understand how to proceed with a chapter 13 case.
In the Bankruptcy Code, there are rules against multiple filings, especially if a prior case was dismissed. In cases like this, a motion to modify or extend the automatic stay are required to prevent a creditor from taking any adverse action. Otherwise, the stay will not apply.
I have a story to share with you. I know of a homeowner that filed a chapter 13 case by himself to stop a foreclosure sale. The case was dismissed because the homeowner did not file the paperwork they were required to file, nor did they show up to court. When the foreclosure came up again, they filed another chapter 13 case, same outcome. The house came up for foreclosure a third time, so the homeowner did the same thing – filed a chapter 13 petition and nothing more. This time, the foreclosure went forward because the automatic stay did not apply because of the repeat dismissals. Homeowner lost the home.
If you have extenuating circumstances because of prior filings, then the cost of hiring an attorney will likely go up since there’s more work involved, especially upfront.
What are other possible bankruptcy fees that may come up during the bankruptcy process?
For many people, especially in chapter 7 cases, the usual fees you can expect with your case are the court filing fee, the credit counseling and debtor education course fees, and the attorney’s fees.
One area where you may expect to pay more for legal services is if you owe tax debt. Determining the dischargeability of tax debt requires extra work, including obtaining tax transcripts to analyze and see whether the debt meet the criteria for discharge. If you owe federal or New York State tax debt, you should expect to pay more for that legal advice.
Although rare, you may expect more fees to be charged in cases where a creditor files an objection against you. Although this can often be anticipated when evaluating a case, a creditor objection means more work and more appearances for counsel since it’s more like traditional litigation, so more fees come with that. An experienced and competent bankruptcy may be able to identify those kinds of issues early on so that you can budget for them.
Another area where extra fees may be incurred in the bankruptcy process may be if you’re experiencing a wage garnishment, and want to try and get back money that was already garnished. That often takes several communications with counsel for the creditor, and possibly even starting bankruptcy litigation against the creditor to try and get the money back.
Can I Make the Bankruptcy Attorney Payment With a Credit Card?
This is not supposed to occur. As a debtor, it is considered fraudulent to incur debt with the intention of filing bankruptcy. Many credit card issuers and credit card processing agreements have in their terms and conditions that the card may not be used to pay bankruptcy attorney fees.
Whether a New York bankruptcy attorney chooses to do so or not is up to them. At the Law Office of Richard Kistnen, we do not accept payment of fees from a credit card of the debtor, in accordance with the Bankruptcy laws and rules. If someone else (like a family member or friend) wants to pay the debtor’s fees with their credit card, that can be done.
If You’re Looking for Bankruptcy Lawyers in New York City, Then Contact the Law Office of Richard Kistnen Today and Get Your Confidential, No-Obligation Consultation
For most people, where there’s debt, there’s financial stress. The good news is that there are many options available for people who are overwhelmed by their debt and would like to be able to live their lives without being tied to it.
One option is to file for Chapter 7 or Chapter 13 bankruptcy. When you file bankruptcy, you experience debt relief immediately. The Law Office of Richard Kistnen is a law firm that is ready to help you get rid of your debt for good.
We offer a confidential, no-obligation initial consultation with an attorney to discuss your options for filing for bankruptcy. During this consultation, you can learn how bankruptcy can help you get a fresh financial start and what the process involves.
At the Law Office of Richard Kistnen, we offer a free consultation with an attorney to talk about your case. Schedule your consultation today by clicking here , or contacting us using the information below!