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Managing bankruptcy filing fees: Installment payments and fee waivers

In our last post, we discussed how the first budget proposal released by President Trump earlier this month contained a provision calling for bankruptcy filing fees to be increased by almost $150 million "to ensure that those that use the bankruptcy court system pay for its oversight."

We also discussed how there was no reason for individuals to be discouraged by this as of the moment given that 1) there is no guarantee that the provision will be included in the final version of the budget, 2) the provision doesn't expressly reference consumer bankruptcy, and 3) the availability of fee waivers or installment payments for those unable to afford filing fees of Chapter 7 or Chapter 13.

Installment payments

In the event, an individual is unable to pay the filling fees for a Chapter 7 or Chapter 13 filing upfront -- $335 and $310 respectively -- they may file a form requesting to pay via a series of installments and proposing a schedule for these payments.

It's important to understand, however, that the proposed payment schedule must meet the following conditions:

  • It can't consist of more than four installment payments
  • It can't call for the final payment to be made more than 120 days after the filing of the underlying petition

Fee waivers

If an individual is simply in no position to pay the $300-plus for either form of consumer bankruptcy, there is no need to panic, as they can file for a fee waiver. If granted, this means that they will be excused from paying any money to file.

Fee waivers will only be granted to those petitioners who will be willing to appear before a judge to answer questions, and who meet the following qualifications:

  • They are unable to make installment payments
  • Their income is below 150 percent of the poverty line

If you would like to learn more about this topic, or the fresh start offered by Chapter 7 or Chapter 13 bankruptcy, consider speaking with a skilled legal professional as soon as possible.

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