How Does an Attorney Get Paid in a Chapter 13 Bankruptcy?
When you file a Chapter 13 bankruptcy, the bankruptcy court appoints a Trustee to administer your case. You make payments to the Trustee, and the Trustee makes payments to your creditors. Your first payment to the Trustee is due within thirty days of the filing of your case. The money you pay to the Trustee pools up in an account at the Trustee’s office until your case is confirmed. Once your case is confirmed your Trustee opens the flood gates and starts disbursing money. The first person to get paid is your bankruptcy attorney.
In our office we charge $600 to file a Chapter 13 bankruptcy. Out of that $600 we pay the $310 filing fee to the bankruptcy court, $60 to the first and second credit counseling agencies, and $28 per Debtor to the data provider to pull your credit report. For a single person filing for Chapter 13, our office gets to keep $202. For a married couple filing jointly for Chapter 13, our office gets to keep $174. For an explanation of Chapter 13 bankruptcy see my article entitled, “The Difference Between Chapter 7 and Chapter 13, and Which One Is Right For You.”
In the United States Bankruptcy Court for the Eastern District of Michigan, there is a $3,500 “no look” fee for attorneys who confirm a Chapter 13 case minus what that attorney has been able to keep so far. For a single person filing a Chapter 13, our office gets upon confirmation $3,298. For a married couple filing jointly for Chapter 13, our office gets upon confirmation $3,326. For an explanation of the confirmation process see my article entitled, “Confirmation of a Chapter 13 Repayment Plan.”
The above information is a general overview and is not intended to be used as legal advice. If you are considering filing for bankruptcy, the best thing to do is call our office at 248-557-3645 and schedule a free consultation so you can receive advice which is tailored to your specific circumstances.
By: Michael Benkstein, Esq.
Managing Attorney, Bankruptcy Department
The Law Offices of Joumana Kayrouz, PLLC
1000 Town Center
Southfield, MI 48075