It’s been a few years since I published How Much Does A Sacramento Bankruptcy Attorney Cost? Since then, the cost of bankruptcy has increased dramatically – just like everything has since 2012.
Bankruptcy Attorney Fees
This is the primary cost of filing bankruptcy in Sacramento. When I started filing cases in 2012 I charged a flat fee of $900 in attorney fees whereas many other bankruptcy lawyers charged $1,500 to $2,000. Now, I still charge $900 for chapter 7 bankruptcy in simple and straightforward cases (social security income, no house, etc.), but for cases involving real estate, businesses, borderline means test income, I charge more than $900. With that said, I give free quotes by phone to anyone who calls my office at (916) 596-1018, so there’s no cost for getting a free consultation and quote.
As of 2021, it seems like most attorneys are charging at least $1,800 for the average chapter 7 bankruptcy case. Most likely these bankruptcy attorneys accept payment plans. The problem with payment plans is that fact patterns change over a few months, and someone who qualified for chapter 7 bankruptcy 3 months ago may not qualify now. When that happens, callers often tell me that their former bankruptcy attorney didn’t issue a refund. In light of the risks of payment plans in bankruptcy, I recommend saving up so you can pay your bankruptcy attorney in full and remove that roadblock to getting your case filed. (Of course, attorney fees have to be paid before your case can be filed, otherwise, the bankruptcy attorney will be discharging their own fee).
Court Filing Fee
Even the court filing fee has increased, but not by much. As of 2021 the Eastern District of California, United States Bankruptcy Court charges a $338 filing fee for chapter 7 bankruptcy. The filing fee only increased by $3 from the previous $335 price tag.
What About Do-It-Yourself Bankruptcy Forms?
The cost of doing anything goes up over time, and filing bankruptcy is no exception. Now, there are some new technologies and non-profits that have the potential of lowering the cost of filing bankruptcy by helping individuals file Chapter 7 bankruptcy without an attorney. In brief, these non-profits use technology to put bankruptcy preparation software in the hands of regular people. This has the potential of helping regular people file bankruptcy without an attorney, potentially saving these individuals over a thousand dollars. (Or $900 – depends on who you hire). The downside to this is the loss of assets. Once a chapter 7 bankruptcy petition is filed, any property that can’t be exempted can be sold by the Trustee. Also, you can’t dismiss a case after filing to protect assets, so once you file you’re stuck. (Read Do It Yourself Bankruptcy Software Is A Trap). Accordingly, I strongly suspect that Chapter 7 bankruptcy trustees who make their living on asset cases will come to love do-it-yourself bankruptcy software and the liquidation cases such software will bring.