What Is The Cost To File Bankruptcy?
Nowadays many people come across with financial difficulties, especially when a big number of companies undergo such processes as reduction of personnel and take-over bid. For that reason many people become jobless and to find a new work can take a lot of time. When financial difficulties happen with a person or a company then the only way out is to file a bankruptcy. Although nobody wants to file bankruptcy, it can be the only way out for people and companies.
Usually, two options are available for companies; they are Chapter 13 and Chapter 7, known as liquidation. As for individuals, they can liquidate their assets in case they meet means test requirements. The Bankruptcy Means Test gives a possibility for individuals to file under Chapter 7. When choosing Chapter 7 or Chapter 13, it is essential to know the cost to file bankruptcy.
As for Chapter 7, the assets of debtors can be divided into exempt and non-exempt. To appease claims of the creditors, the trustee should liquidate non-exempt lien free assets. Sometimes the court asks the trustee to control debtor’s business for some period of time if a debtor is an individual proprietor. The amounts and fees that should be paid are the following: 245, $39 and $15 for application fee, administrative fee and trustee surcharge. The application fee can be paid in installments. It is allowed to pay the application fee in four or less installments. Within 120 days the petition should be filed and the final installment should be paid. But there are exceptions according to which the court lets the debtor a grace period of 60 days. It is also possible to pay the administrative fee and the trustee surcharge in installments. The court can absolve a debtor from paying fees in case the income of the debtor is less than 150 percent of cost living income. Couples, filing jointly have to pay application fee, administrative fee and trustee surcharge only once.
Chapter 13 is a plan of repayment with the help of which the debtor can pay discharge secured and unsecured assets during 5 years. The trustee has the role of interface as he gets money from the debtor and then brings them to the creditors. The debtor has to pay the amount of $39 for an administrative fee and $235 for a filing fee. It is possible to pay fee in four installments within 120 days.
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