What are considered reasonable attorney fees?

[butterfly57]

I am new to this site and absolutely a nervous wreck. I am female, in my early 50's, always had terrific credit, but have experienced major life changes in the past 5 years. So I am truly despondent over the fact that I have to claim bankruptcy. I am making myself physically sick over this. To sum things up I have huge federal & state tax debt (I passed the 3 year mark) and some medical and credit card bills.

I met with the attorney last Monday to consult about claiming chapter 7. I completed the paperwork they gave me prior to our meeting. The male attorney I had made the appointment with, came out and told me I'd be speaking with his new associate, a young woman I had never met before and new to the firm. He had mistakenly booked something else onto his schedule. She was very professional and thorough and gave me the distinct impression she'd be handling this from start to finish, not him. She left the room 3 times to ask the older attorney some questions she was unsure of. This male attorney is well known, supposed to be the best, been practicing bankruptcy law over 20 years, etc. She strongly advised me to get rid of a vehicle I own outright since it's value is over $4,000 and I need money for attorney fees. Then she told me what their fees are and I about fell over. He charges $535 an hour, her charges are $250 an hour and the paralegal $150 an hour. Total fees including court costs and credit counseling $3,878. They need $1,939 to get started and the balance before they file. If for some reason they spend extra time on my case they will charge me in addition to the $3,878 their hourly fees. So my question obviously is, am I being overcharged for chapter 7 services???
PS I apologize for this being so lengthy.

[mountanddo]

My attorney charges $2500 for C-13 and said it would be $3200 for C-7 and my case is a very simple case. I own nothing and have only 20k cc debt and one $400 federal tax owed. So no, I wouldn't say you are being overcharged. I would, however ask what circumstances might be over and above the $3878 so you are prepared for that. Unfortunately it costs money to go bankrupt...go figure

[PANSYFACE]

Welcome - my attorney charged me $1300 for a chapter 7 - and this is someone who has been doing this for many years and has been a trustee as well. Court costs were $299 and credit counseling course $30. What else could this possibly include?
Maybe others will chime in.

[IamOld]

Butterfly WELCOME to the forum - you'll find MANY MANY very smart and caring people here!!! (Including your fellow nervous wreck!!! :-)

Is that fee reasonable - well, it sounds on the HIGH side...are you a simple case? Are you over or under NC state median? Complicated "stuff??" (By the way, he's likely right about the car)

As I'm sure others may tell you, it would be a VERY good idea to consult at least one or two other atty's...
From what I've seen in my case and others on this board, generally the BK is a flat fee...

[mountanddo]

I wasn't too worried about the cost because I'm filing C-13 and the fees are in my plan. If I was filing C-7 I may have shopped around a bit more. I hope this thinking is right..

[butterfly57]

Wow! Thanks for the answers to my post so quickly! I do plan on consulting another attorney, she handles everything bankruptcy, divorce, traffic tickets which actually scares me a bit. I don't think I'm too complicated. I don't make much money, I don't own much of anything of value accept my vehicle (worth about $10,000 but needs about $3,000 in repairs I can't afford). I am on the deed of a home that my ex-husband lives in and my name is on the home equity loan to that home. My "new" husband (I know that sounds just awful) is not involved in any of my debt and has his own debt to be concerned about (child support & a payment plan to the IRS). I fear the tax debt could get complicated, although they didn't delve into that as a major problem during my meeting. I have been really depressed since my visit with the attorney, very sad that my life has come down to this. And then to try to figure out how to pay the attorney....ugh! I also have been paying on my department store credit cards, foolish me thought I could keep those, I've had them forever but no those go plus the car. I feel like the carpet has been pulled out from under me.

[holycowe]

We paid $1500 for both of us chapter 7 and our case is a little bit complicated.

[oregonpilot]

holy cow holycowe......sorry, i just had to say that. LOL

Welcome butterfly. i paid just under $1900. for my c7 and i am self-employed so things were a little bit more complicated.

i know it is easy for me to say not to make yourself sick....i did it too. think most here have been in the same place that you are in right now.

i turned 60 this yr and also had excellent credit never once in my life late on a payment. thought that my life was over!! just thinking about bk and what was i going to do now,
It worked out and life is so awsome it should be illegal.
Sounds like "visiting" with other atty's would be a good idea.
Good luck to you. We are here for you.

[lillymarlene]

butterfly57 Welcome. I'm in my late 50's and filed chapter 13 last year. I can understand, it's such a shock at first, though I knew I couldn't keep up this robbing Peter to pay Paul, forever. But, it does get better. The debt free, credit card free lifestyle is so much more PEACEFUL.

I don't know, but your chapter 7 seems a little high. My c13 was $1,850 down, and $2,000 in the plan. This included filing fees, and also the required 2 courses. It seems like chapter 7's are usually less. If you have time, I would shop around, go on free consults with different attorneys. I was also able to keep my paid for car, that was valued at $4,500. If I had done a c7, I was told I could "buy it back" at about $500 per month from the trustee.

Well, best wishes and good luck.

[butterfly57]

I think this attorney might be a necessary evil and he knows it. He understands how and why the tax debt came about since my ex-husband and I used him for a consult while we had a failing business. We didn't claim bankruptcy for the business, just closed it and sold the property we personally owned. This attorney dealt with our creditors and distributed the funds to them and paid some high, overdue taxes for the business. We probably shouldn't have used our personal money to pay the business debt, stupid mistake and we paid lots of money to this attorney and his tax advisor buddy who used to work for the IRS. No one advised us what to do in regard to our personal taxes. So wham! 7 months later the accountant produces our tax returns and the ex and I (separately) owe more than we have. We had borrowed so many times against that property hoping to save our business, so we barely made what we should have. But, I did pay off my car with some of the funds, the ex paid off whatever he owned at the time. The ex is in the house we own and the home equity is the only thing in my name. So I don't know if this is a simple Chapter 7. I own a house with the ex, owe taxes from a property sale, owe some medical bills, some small credit card bills. I rent now with my "new" husband who unfortunately is not a wealthy man and has become disabled recently. So we struggle week to week. I hate giving up my vehicle, number one because it seems like it's all I have left of my old life and number two the part time job I do have requires me to drive from store to store every week so I need a reliable vehicle. But, I know it needs to be gone ASAP. So does it look like I need to use this same attorney?

[IamOld]

butterfly, I'm so sorry to hear about all that has gone on...but I will tell you if it isn't a simple case you may want to pay the money to the guy who knows what he is doing.

I am actually encouraged by the fact that when you met with Atty # 2 didn't know something she immediately checked with atty #1.

[Drazil65]

Get at least 2 or 3 other attorney consults and let no one bully you into a situation where you feel that he is the only one that can help you just because he knows your case. We are paying $1200 plus filing fees (maybe $350 dollars more). So about $1500 total I guess. You do not seem to be comfortable with being handed over to the new associate and those fees are not something I would even consider personally. Maybe you need a new set of eyes on your state of affairs, it does not sound like he did all that much for you previously if truth be told, soemthing to think about. Keep reading everything here, all the threads and stickies at the top, you will feel much better about your situation and feel like you are taking back some control. Good Luck!

[HHM]

Sounds like you have several issues going on, home mortgage with an ex spouse (realize, from the attorney perspective, a domestic issue creates complexity because the ex-spouse knows the truth of your circumstances and can easily get the trustee's information), and you have tax issues and possible non-exempt assets.

I think you are probably okay with the attorney given your circumstances. Most cheaper attorneys will let the chips fall where they may and barely advise you on how to get the best BK.

There is no such thing as "standard" fee for bankruptcy. And knowing what someone paid in Nevada for there bankruptcy is in no way helpful to knowing what might be fair in Florida.

[angelasdad]

I was about $2000 including filing fees and credit counseling for a chapter 7. Chapter 13 would have been almost double but some rolled into the payments. My attorney is THE attorney in BK, and about as well known as anyone in my area. I will say that I jumped on board with the the first attorney/firm I talked to. I was very comfortable with them and I figured their firm has done thousands of BK's so I should be good. I shopped around a bit after and found them a little high, maybe by 10%. However, in the long run they covered everything I needed, answered my questions to emails in a matter of hours, attended all of my appearances, paperwork was flawless and in order, etc. I don't mind paying a little more for competence, which is what I got, but your quote seems to be excessive.

[ValleYum]

butterfly, I'm so sorry to hear about all that has gone on...but I will tell you if it isn't a simple case you may want to pay the money to the guy who knows what he is doing.

I am actually encouraged by the fact that when you met with Atty # 2 didn't know something she immediately checked with atty #1.

But is butterfly gonna have to pay $250 per hour for her to ask questions and learn?? And if #2 asks #1 questions - do they both charge her their hourly fee?

The research time that a fairly new (to BK) lawyer may have could be very costly when billed by the hour.

Just my thoughts... Those and a buck will buy you a cuppa coffee.