If you’ve recently been getting calls from debt collectors, or mail from addresses like PO Box 4115 Concord CA, it may be time to start exploring your debt relief options. If you’re considering bankruptcy, but aren’t sure if it’s best for your situation, consider taking a “When To File Bankruptcy Quiz” to see what your options are. If you think bankruptcy is a good option for you, then there are some things you should know moving forward. One of the most important things is your need for a bankruptcy attorney. Even though there are no laws requiring you to have an attorney representing you while filing for bankruptcy, it’s probably a good idea to have someone representing you.
A bankruptcy attorney can offer the clarity you need to decide whether filing bankruptcy is the best option for you. Unfortunately, when filing bankruptcy, most people shy from contracting the services of a bankruptcy attorney due to concern overpaying attorney fees. This fear has kept many from getting debt relief to overcome debt. So, before assuming you cannot meet the expenses of filing bankruptcy, here is everything you should know.
Can A Bankruptcy Attorney Accept Payment Through a Credit Card?
Most bankruptcy attorneys accept payments in cash, cheques, and debit cards. They barely accept credit card payments to avoid helping you commit fraud.
When you are bankrupt, you are aware of your inability to repay any debt you take. Therefore, if you are bankrupt and use your credit card to pay attorney fees, it will be considered fraud. Before taking a credit card, there is an application form the credit company requires you to sign.
The agreement on the form indicates you should promise and commit to repaying all the amounts you charge on your credit card. Thus, charging expenses on the card you know you cannot repay violates this agreement. It is considered fraud, and you might get prosecuted for it. If found liable, you might pay a fine or do jail time. You can read more about it in this article.
Another reason attorneys refrain from taking credit card payments is because credit card debts are considered unsecured debts. Therefore, it is a dischargeable debt, and the creditor cannot take any measure to collect discharged debts if pardoned by the court.
Keep in mind that the costs of bankruptcy can vary from state to state. So if you are filing for bankruptcy in New York, the cost will be different than if you filed for bankruptcy in Kentucky. Knowing the cost of bankruptcy in your state can help you better plan for how to pay for the expenses.
Is It Allowed to Take a Cash Advance on a Credit Card to Settle Bankruptcy Attorney Fees?
If you cannot directly charge your bankruptcy attorney’s fee from your credit card, then you can take a cash advance on your credit card to settle the fees, right?
Wrong.
As tempting as it may be to load up your credit card before filing for bankruptcy, it is a decision you might live to regret. In most cases, the cash advances or debt purchases made right before filing for bankruptcy relief are not discharged.
Your creditor is constantly monitoring the credit purchases within 90 days of filing bankruptcy. Therefore, there is no assurance that these debts will be discharged.
So, buying luxury items worth $725 or more within 90 days of filing bankruptcy or taking cash advances exceeding $1,000 within 70 days of filing bankruptcy may be fraudulent. Thus, taking a cash advance may not be a wise decision.
How Much Does It Cost to Hire a Bankruptcy Attorney?
Before filing for bankruptcy, it is essential to understand the costs involved, including the cost of hiring an attorney. Besides, bankruptcy comes when you have little to no money left to meet your obligations. So, you need to know how much attorney fees to expect.
The cost of hiring an attorney will vary with several factors like:
- The area you live in
- The Chapter of bankruptcy you intend to file
- How experienced the attorney is
- The complexity of the case
Fortunately, most bankruptcy attorney sites have an online fee estimator. You can key in the details of your case and estimate how much it will cost you. Alternatively, you can schedule a free bankruptcy consultation with us to get a quotation.
Paying Your Bankruptcy Attorney: Do They Accept Payments and How To Make the Payments?
Unless working pro bono, bankruptcy attorneys will accept payments for their services. However, the payment schedule will depend on the Chapter you are filing. Your attorney understands your financial situation, so most Chapter 7 lawyers can allow you to pay the fees in installments. However, they might require you to pay the entire fee before filing your case.
When filing Chapter 13, the attorney can add his fees under your repayment plan. Therefore, you might only have to pay the filing fee and pay the rest when making your repayment. Nonetheless, the payment plan will vary according to your attorney. Therefore, use free consultations to ask about payment plans before settling on the best bankruptcy lawyer for you.
Most bankruptcy attorneys will discuss two payment plans when discussing cost. The first is a recurring repayment plan where you fully settle the attorney fees before filing bankruptcy. You can agree on weekly or monthly payments until you complete making the payments. Some attorneys sum up the filing and service fees, while some charge them separately. So remember to ask for a breakdown to avoid any misunderstanding.
The second option is the $0 down option. Under this plan, the attorney may agree to file your case without asking for upfront fees. However, they will charge a fee before and after the bankruptcy. However, it is a more expensive option since the attorney accounts for a degree of risk.
Should You File for Bankruptcy or Settle for a Non-Bankruptcy Debt Relief Option?
Without a deep understanding of debt relief or bankruptcy, it is easy to make the wrong choice. However, we are here to help. Contact us today to discuss bankruptcy and other debt-relief options available to determine the most favorable option.