With large numbers of Americans filing bankruptcy every day, it's no surprise that many of them still question if it is possible to file bankruptcy for free.
When the bankruptcy code changed back in 2005 there were many additions that made the entire process more complicated and expensive.
That is expensive for those that are broke.
Realistically, filing Chapter 7 bankruptcy is really not that expensive, it just depends where you look at it.
Going back to the changes of the bankruptcy code, added was a pre-bankruptcy credit counseling course and a post-bankruptcy financial management course.
These were two added costs above and beyond what it costs previously.
For these courses a person could do them online for approximately $25-$50 apiece.
While this does not sound like a lot of money, for someone that is living paycheck to paycheck and might as well be $1000.
There is some help in this area as there are some organizations that offer scholarships for these courses for those who are less fortunate.
All a person needs to do is apply for it and if they qualify they could take the course for free.
The costs of filing bankruptcy go further than just the two courses.
The person will be required to pay the bankruptcy court approximately $306 for filing fees when filing Chapter 7 bankruptcy and $281 for filing Chapter 13 bankruptcy.
I don't know why the fee for Chapter 13 is less than Chapter 7 but it is.
It is probably because the bankruptcy trustee gets paid a percentage of the Chapter 13 plan to manage it.
Anyways, these fees have to be paid at the time of filing the bankruptcy petition unless the individual wants to see the bankruptcy judge and ask to have these fees waived because the individual can't afford it.
In most cases the bankruptcy judge will allow it.
Now that we have covered the external costs and found out it is possible to file for bankruptcy for free, but this is only if you're filing pro se or a do-it-yourself bankruptcy.
It is perfectly legal to file pro se, but depending on how complicated a person's bankruptcy filing is, it's not a good idea.
It's really no different than the person not going to the doctor and treating themselves for a disease or sickness, it just doesn't make sense.
The most expensive part of filing bankruptcy is hiring a bankruptcy lawyer to represent the individual.
To hire a bankruptcy lawyer can cost approximately $1000-$2000 when filing Chapter 7 bankruptcy and filing Chapter 13 bankruptcy could cost anywhere from $2000-$4000.
The Chapter 13 is much more expensive because the entire process lasts 3 to 5 years.
The bankruptcy lawyer might be required to modify the Chapter 13 plan midstream to accommodate the debtor.
For individuals that cannot afford to hire a bankruptcy lawyer, there are organizations where lawyers volunteer and work pro bono.
For someone in this situation they should contact local help organizations.
When it comes down to it, hiring a bankruptcy lawyer seems expensive but weighing the pros and cons of not having one doesn't make sense.
Comparing the cost versus the amount of debt that is wiped out in the bankruptcy filing, will show that having legal help is very cost effective and quite a value.