How Much Does It Cost to File Bankruptcy in Texas?

How Much Does It Cost to File Bankruptcy in Texas?

How Much Does Bankruptcy Cost?

What does it cost to declare bankruptcy? The cost to file bankruptcy includes the required filing fees for Chapter 7 or Chapter 13 Bankruptcy, required credit counseling and financial management fees, and certain other fees depending on how you choose to proceed with your case.

Determining how much to file bankruptcy in Texas depends on whether you choose to file with the help of an attorney or file instead as a “pro se,” (self-represented) litigant. If you choose the attorney route, the attorney will have to charge you a reasonable rate for their time and services, based on the location where they work.

You may wish to convert your case from one type of bankruptcy to another at some point along the way, which has an additional fee. The bankruptcy trustee managing your case may charge a nominal fee. And of course, there are costs related to your own organization of documents and information, travel, and time to appear at bankruptcy court, and long-term impacts of bankruptcy on your credit. Although not “out-of-pocket” costs, these additional costs are also worthy of consideration.

Bankruptcy is an economic decision through and through. To help guide you, the Houston bankruptcy lawyers at Law Offices of Seth Kretzer provide an overview of the anticipated costs of bankruptcy in this article.

How Much Does Chapter 7 Bankruptcy Cost in Texas?

How much does it cost to file Chapter 7? If you qualify to file Chapter 7 Bankruptcy, the Texas Bankruptcy Court’s filing fee for a Chapter 7 Bankruptcy is a fixed rate of $335.00. The Bankruptcy trustee may charge an additional $15 to $20 or may waive this fee. Mandatory credit counseling fees will range between $20 and $100. Attorney’s fees will range between $975 and $2,000 on average.

So how much does Chapter 7 cost, overall? All in, the total cost of your Chapter 7 Bankruptcy will likely be from $1,345 on the low side to $2,455 on the high side. If you cannot pay the filing fee all at once due to your financial circumstances, most courts will allow you to explain your circumstances and request to break the payments up over time, in an installment plan.

Conversion Fees

How much does it cost to file Chapter 7 bankruptcy in terms of conversion fees? If you first file under Chapter 7, known as a liquidation bankruptcy, and later convert to Chapter 13, known as a reorganization bankruptcy, there is no fee. However, if you go in the other direction and first file for Chapter 13, later converting to Chapter 7, there is a conversion fee of $25. Reasons for bankruptcy filers wishing to convert between types of bankruptcies often relate to changes in financial status.

For example, if you can afford to pay back your debts in a structured management plan, you may not qualify for Chapter 7 Bankruptcy (but you will qualify for Chapter 13). But if you lose your employment, you may better qualify for Chapter 7 (and not Chapter 13).

Credit Counseling and Financial Management Fees

How much does bankruptcy Chapter 7 cost for credit counseling and financial management fees? The Bankruptcy Court will require you to undergo credit counseling and take a personal financial management course during the pendency of your bankruptcy case. This is designed to help you recover from the impacts of bankruptcy, and to ensure a brighter financial future. The required cost for these bankruptcy fees in Texas will generally be between $20 and $100.

Attorneys’ Fees

How much does it cost to file bankruptcy in Texas for Chapter 7 attorneys’ fees? Should you choose to work with a qualified bankruptcy attorney, the attorney will have to charge you for their time, knowledge, and labor. The flat fee range for a bankruptcy attorney in Texas is between $975 and $2,000, with an average flat fee of $1,487.50 in Texas. This will vary based on the complexity of the case.

In the Southern District of Texas, there is a court-approved “fixed fee” of $4,500 for consumer cases and $5,600 for business cases, to cover the more complex filings. The complexity of the case can cause a variation in attorneys’ fees. For example, in a “no-asset” bankruptcy, where no exempt assets are claimed, there are less likely to be legal challenges and thus less litigation is required. After discussing your case with you during a consultation, some attorneys may also offer you an hourly rate.

In the end, the investment in hiring an attorney for your bankruptcy will be well worth it, as bankruptcy involves complex paperwork filing and administrative tasks, as well as checking frequently with PACER (the federal court’s electronic database) to keep abreast of deadlines for filing, court appearances, etc.

cost to file bankruptcy in Texas

How Much Does Chapter 13 Bankruptcy Cost in Texas?

How much does it cost to file Chapter 13 bankruptcy? If you qualify to file Chapter 13 Bankruptcy, the Texas Bankruptcy Court’s filing fee for a Chapter 13 Bankruptcy is a fixed rate of $310.00. The Bankruptcy trustee may charge an additional $15 to $20 or may waive this fee.

Mandatory credit counseling fees will range between $20 and $100. Attorney’s fees will range between $975 and $2,000 on average. All in, the total cost of your Chapter 13 Bankruptcy will likely be from $1,320 on the low side to $2,430 on the high side. If you cannot pay the filing fee at once due to your financial circumstances, most courts will allow you to explain the circumstances and request to break the payments up over time.

Conversion Fees

How much does it cost to file bankruptcy for Chapter 13 in terms of conversion fees? If you first file for Chapter 13 and later convert to Chapter 7, there is a conversion fee of $25.

Reasons for bankruptcy filers wishing to convert between types of bankruptcies often relate to changes in financial status. For example, if you can afford to pay back your debts in a structured management plan, you may not qualify for Chapter 7 Bankruptcy (but you will qualify for Chapter 13). But if your employment status changes after job loss, you may better qualify for Chapter 7 (and not Chapter 13).

Credit Counseling and Financial Management Course Fees

How much does filing bankruptcy cost in Texas for Chapter 13 credit counseling and financial management course fees? The Bankruptcy Court generally requires you to undergo credit counseling and take a personal financial management course during the pendency of your bankruptcy case. This is designed to help you recover from the impacts of bankruptcy, and to encourage a promising financial future. The required course will generally cost between $20 and $100.

Attorneys’ Fees

How much does filing bankruptcy cost in terms of attorneys’ fees? Should you choose to work with a qualified bankruptcy attorney, the attorney will have to charge you for their time, knowledge, and labor. The flat fee range for a bankruptcy attorney in Texas is between $975 and $2,000, with an average flat fee of $1,487.50 in Texas. This will vary based on the complexity of your Chapter 13 bankruptcy case.

In the Southern District of Texas, there is a court-approved “fixed fee” of $4,500 for consumer cases and $5,600 for business cases, covering the more complex filings. The complexity of the case can cause a variation in the fees. For example, in a “no-asset” bankruptcy, where no exempt assets are claimed, there are less likely to be legal challenges and thus less litigation is required. After discussing your case with you during a consultation, some attorneys may also offer you an hourly rate.

Cost of Filing Pro Se vs. with a Bankruptcy Attorney

Some people may want to represent themselves in bankruptcy, without an attorney. This is completely understandable given the dire financial straits anyone approaching bankruptcy is in. However, for those who attempt to file on their own (“pro se” filers) swift resolution is unlikely to occur.

First, bankruptcy is filled with forms and schedules, requiring organizing and inputting of financial information. While you don’t need to be an accountant to manage it, it is preferable to be a person whose profession it is to distill complex information daily, and this is exactly what lawyers do.

Second, nearly everyone involved in your bankruptcy – the trustee, the judge, and the representatives of creditors – is a present or former attorney. It helps to be able to “talk the talk.” Finally, a legal advocate can make your strongest case for bankruptcy, and although you may have an additional chance later to re-file, the time, expense, emotional anguish, and present need all necessitate making the best presentation to the court, the first time around.

For all these reasons, working with an expert bankruptcy attorney is recommended.

The Law Offices of Seth Kretzer Will Help You Make the Most of Bankruptcy

If you are trying to assess the costs related to bankruptcy, you will need a lawyer with specific experience on bankruptcy in Texas and who has the right knowledge and resources to help you.

Contact the Law Offices of Seth Kretzer today to discuss your case and schedule a free consultation.

Phone: 713-775-3050
Fax: 713-929-2019
Houston, TX 77002
440 Louisiana, Suite 1440