Bankruptcy can be the best option for many people dealing with serious financial problems. If you qualify, you can have most of your debts forgiven, meaning you will no longer need to pay those creditors. Although this is a great option to seek financial relief, there may be a big question you need to deal with. Who pays for the bankruptcy?
Who Pays Bankruptcy Filing Fees?
You made the difficult decision of filing for bankruptcy – but you may be wondering who will need to pay the costs associated with the filing. The short answer is that bankruptcies are paid for by the person filing bankruptcy. It costs $338.00 to file Chapter 7 bankruptcy in the State of California. You can pay the filing fee for Chapter 7 bankruptcy upfront or in installments. In some cases and based on your household income and family size, you may even be granted a filing fee waiver.
The attorney’s fees to file your Chapter 7 bankruptcy will generally vary depending on the complexity of your case. Your Central Valley bankruptcy attorney will evaluate a number of factors to determine the fees associated with your filing.
Who Pays the Actual Debt?
One of the main reasons people file for bankruptcy is to wipe out their debt and help them regain control of their financial livelihood. However, this discharge can also pose the big question of who actually pays these debts. Below is an overview:
- You will pay a portion. In some cases, you as the filer of bankruptcy may be paying a portion of the debt. You can make payments a number of different pays, such as selling assets or having the debtor place a lien on your house to get paid from a portion of the sale proceeds.
- Companies can absorb debts. In some cases, the debtor will absorb the debts. Larger companies are generally prepared for such circumstances and put aside money to absorb the discharged debts.
New Debts Incurred After Filing for Chapter 7 Bankruptcy
Any debt that you incur after filing for Chapter 7 bankruptcy will not be discharged. These new debts are labeled by the court as post-petition debts that you will have to pay back. If you reaffirm a debt that could be discharged, you are agreeing to be personally liable for that specific debt even after your bankruptcy filing has been discharged.
Your Central Valley bankruptcy attorney can provide you with more details and help you prevent incurring new debt after filing for Chapter 7 bankruptcy.
Call an Experienced Central Valley Bankruptcy Attorney
If you are considering Chapter 7 bankruptcy, it is in your best interest to consult with an experienced bankruptcy attorney to help you learn your legal rights and options, especially with respect to Chapter 7 bankruptcy.
For more information or to schedule a complimentary consultation with Central Valley bankruptcy attorney Gurjit Srai, please call 209-323-5558, or complete our online form.