📅 2026 Update: Key Changes in Bankruptcy Law and Fees

Since the original article was published, there have been important changes in bankruptcy laws and financial thresholds. These updates impact the way individuals approach bankruptcy and the fees involved. The original article continues further down the page to provide more details on attorney fees and related topics.

🏦 Chapter 13 Debt Limits

As of March 31, 2028, the debt limits for Chapter 13 bankruptcy have increased to $1,580,125 for secured debts and $526,700 for unsecured debts. These limits are adjusted periodically, which means they can change in the future. Understanding these limits is crucial for individuals considering Chapter 13 bankruptcy.

💼 Attorney Fees

The U.S. Trustee Program does not set specific fees for bankruptcy attorneys. Instead, fees can vary based on the complexity of the case and the attorney's experience.

Individuals should consider consulting multiple attorneys to get a sense of the prevailing rates in their area.

📋 Credit Counseling Requirement

Before filing for bankruptcy, individuals must complete a credit counseling course approved by an agency. This course must be taken within 180 days prior to filing. This requirement helps individuals understand their financial situation better before entering bankruptcy.

⏳ Processing Times

In Chapter 7 bankruptcy, debtors typically receive a discharge of qualifying debts about four months after filing. For Chapter 13, the repayment plan usually spans three to five years, depending on the specifics of the plan and the individual's income. Being aware of these timelines can help individuals plan their financial recovery.

📌 Summary of Key Points

  • 🏦 Chapter 13 debt limits are now $1,580,125 for secured debts and $526,700 for unsecured debts.
  • 💼 Attorney fees vary; no standard fees are set by the U.S. Trustee Program.
  • 📋 Individuals must complete a credit counseling course within 180 days before filing.
  • ⏳ Chapter 7 discharges occur in about four months; Chapter 13 repayment lasts three to five years.

💡 Tips for Navigating Bankruptcy Fees

Review your own situation closely with your attorney.

📊 Understand Your Debt Limits

Knowing the current debt limits for Chapter 13 bankruptcy can help you determine your eligibility. As of March 31, 2028, unsecured debts must be less than $526,700, and secured debts must be less than $1,580,125.

🔍 Get Multiple Quotes

Since attorney fees are not fixed, it is wise to consult with several attorneys. This will give you a clearer picture of what to expect in terms of costs and help you find someone who fits your budget and needs.

📅 Complete Credit Counseling

Make sure to complete a credit counseling course from an approved agency within 180 days of your intended filing. This step is a requirement and can guide you through your financial options.

💡 Know the Processing Times

Understanding the timelines for both Chapter 7 and Chapter 13 bankruptcies can help you plan accordingly. Discharges in Chapter 7 occur in approximately four months, while Chapter 13 repayment plans can last three to five years.

📜 Be Aware of Dischargeable Debts

It's important to know which debts can be discharged in Chapter 13 bankruptcy. While many debts like credit card balances can be discharged, certain obligations, such as most taxes and child support, usually remain.

🏆 Free Options Ranked by User Reviews (2026)

No national paid service in this area met the review threshold, so this section lists free government and nonprofit resources that offer assistance with bankruptcy matters.

🥇 1. Approved Credit Counseling Agencies

These agencies provide free or low-cost credit counseling services. They help individuals assess their financial situations and explore bankruptcy options. This can be a vital resource for those unsure of their next steps.

🥈 2. U.S. Trustee Program

The U.S. Trustee Program is a government agency that oversees the bankruptcy process. They provide resources and information on how to file for bankruptcy and what individuals can expect throughout the process.

This program is helpful for those looking to understand their rights and responsibilities.

🥉 3. Local Nonprofit Organizations

Many local nonprofit organizations offer free financial counseling and education. These services can help individuals understand their options and improve their financial literacy, which is crucial when considering bankruptcy.

4️⃣ State-Specific Resources

Each state has its own resources for individuals considering bankruptcy. These can include legal aid organizations that offer free or low-cost consultations. Exploring state-specific options can provide tailored assistance based on local laws.

🔎 What to Check Before Paying for Help

  • 🚫 Confirm the legitimacy of the service.
  • 💰 Understand all fees upfront.
  • 📝 Look for reviews and ratings.
  • ❓ Ask about the services included.

❓ Frequently Asked Questions

❔ What is the means test for Chapter 7 bankruptcy?

The means test evaluates an individual's income and expenses to determine disposable income. Passing this test is necessary to qualify for Chapter 7 bankruptcy.

💳 What types of debts can be discharged in Chapter 13?

In Chapter 13 bankruptcy, individuals can discharge debts like credit card balances and medical bills. However, obligations like child support and most tax debts are usually non-dischargeable.

⏳ How long does Chapter 13 bankruptcy last?

Chapter 13 bankruptcy allows individuals to repay debts over a three to five-year period. The specific length of the repayment plan depends on the individual's income and the plan's details.

🗓️ What happens if I miss the credit counseling deadline?

If you miss the 180-day deadline for credit counseling, you cannot file for bankruptcy until you complete the course. This could delay your bankruptcy process significantly.

📊 Can I convert my Chapter 13 case to a Chapter 7 case?

Yes, individuals in Chapter 13 bankruptcy can convert to Chapter 7 if they qualify. This involves passing the Chapter 7 means test and updating their financial disclosures.

🔒 What are bankruptcy exemptions?

Bankruptcy exemptions allow individuals to protect essential property from creditors. These exemptions vary by state and can include items like a primary residence and retirement accounts.

⚖️ Recent Bankruptcy Cases

Recent court rulings have highlighted important aspects of bankruptcy law, particularly concerning dischargeable debts and eligibility criteria. These rulings play a crucial role in understanding the current landscape of bankruptcy.

For more recent rulings, visit the more rulings on the news page.

End of October 2026 Update





What are Bankruptcy Fees?

1. Before hiring a bankruptcy attorney and subsequently filing for the financial relief available, you must first understand what bankruptcy is and evaluate how the claim can help your particular financial situation.

2. Bankruptcy is a financial program operated and administered by the Federal Government of the United States under Bankruptcy Law.

3. Bankruptcy claims are initiated by business entities or individuals who are struggling with debts, and more specifically, satisfying their repayments or loans to creditors. To alleviate this burden and offer a form of financial relief, an individual or business entity will file for bankruptcy.

4. Bankruptcy enables those in debt to seek relief through the creation of an alternative payment plan or a liquidation process. Liquidation (which is attached to a Chapter 7 filing) forces those in debt to sell off their secured assets. The proceeds from the sales are then used to help repay their loan requirements and debts.

5. Through the inclusion of a Government agency, those individuals and entities struggling with debts can reorganize their debt structure by making incremental payments to their creditors.

6. There are many different forms of bankruptcy filings, the most common being Chapter 7 filings, Chapter 11 filings, and Chapter 13 filings.

7. Each form of bankruptcy claim aims to alleviate the individual or entity in debt through different means. A Chapter 7 filing will immediately resolve debts through liquidation—the individual or entity’s assets are sold and the proceeds from the liquidation are used to pay off the debts owed.

8. A Chapter 11 filing is typically initiated by a business entity that is struggling with sales or earning a profit. A Chapter 11 filing enables the business to maintain its operation (through the appointment of a trustee), while developing repayment plans that are aligned with the company’s expected profits.

9. Lastly, a Chapter 13 Bankruptcy claim enables an individual or business entity to restructure their payment plan through the delivery of incremental pay periods. The incremental schedule is developed based on the debtor’s income, living expenses and the various amounts owed to the underlying creditors.

10. Each type of bankruptcy filing will require the services of a bankruptcy attorney or legal professional to facilitate the case. A bankruptcy attorney will streamline the case through the delivery of an advanced knowledge of bankruptcy law, as well as an understanding of the process.

11. All forms of legal aid require payment. Bankruptcy attorney fees refer to the amount of money a legal professional is paid by the debtor for assisting with the underlying case.

12. Bankruptcy attorney fees are typically in proportion to their experience—those attorneys who are more experienced are paid higher rates.

13. In most instances, bankruptcy attorneys will charge hourly rates and will fluctuate their pay scale based on the severity of the bankruptcy case and the amount of money in question. Those cases that are regarded as more complex will be more expensive.

14. As is common with most forms of legal aid, bankruptcy attorney fees are typically exorbitant.  In most instances, a debtor is typically looking at a total bill of $2,000 to $3,000 in bankruptcy attorney fees.

15. Another variable in regard to bankruptcy attorney fees is found in what type of bankruptcy is being filed. The differences in payment stem from the varied processing times required for each form of bankruptcy. Typically, a Chapter 11 case is the most expensive form of bankruptcy. Chapter 7’s, 12’s and 13’s are considerably less in terms of bankruptcy attorney fees.

15 Facts You Must Know About Bankruptcy Attorney Fees