I have written about the cost of Chapter 7 Bankruptcy in Sacramento as well as recent increases to the filing fees here in town. One question I often get is whether the Bankruptcy Filing Fee can be paid in installments. The answer is yes!
Currently the Chapter 7 Bankruptcy filing fee is $335. This amount does not go to the attorneys. Rather, it is the fee that the United States Bankruptcy Court charges to start a new bankruptcy case. Think of it as the “price of admission” to bankruptcy court.
Part of the fee pays for the court itself, including staff and facilities. Part of the filing fee compensates the Chapter 7 Trustee that is assigned to your case.
While bankruptcy can be expensive both in attorney’s fees and the court filing fee, there are ways to help reduce the burden. One option my clients ask for is the Chapter 7 Bankruptcy Filing Fee Installment Plan.
At the start of a case, we can ask the Judge to pay the filing fee over time. This can be helpful to a person that needs to file a case immediately to stop a wage garnishment or bank levy. Most of the time the requests are granted.
Currently, the Bankruptcy Court will allow a person to request up to four installments. Because the filing fee is $335, that works out to be just over $83 per month over four months.
Typically I will propose to the Court that the first payment be due one month after the filing of the case. Each subsequent payment is due a month after that, until all $335 has been paid in full.
A person considering the payment plan for filing fees needs to be careful! The Bankruptcy Court can close your Chapter 7 case if you do not make all of your payments on time. Or, if at the end of the case, you owe any money to the court, they will dismiss your case without discharge. If this happens, you will have to pay additional attorney’s fees and a new filing fee to reopen your case — just to pay your remaining balance.
If you have any questions about the filing fee for Chapter 7 Bankruptcy in Sacramento, please call my office at (916) 333-2222.