If you’re considering filing for Chapter 13 bankruptcy, you probably want to know how much you’ll have to pay your lawyer. And if an attorney has already quoted you a price, you may want to find out how it compares to what other lawyers charge. We surveyed our readers who had filed for this type of bankruptcy and, for comparison, we researched the fee guidelines used by bankruptcy courts in different parts of Florida. Here’s what we learned.
Approval of Chapter 13 Lawyers’ Fees
The bankruptcy court has to approve all of your financial expenditures in a Chapter 13 case—including what you pay your lawyer—so the judge will decide whether your attorney’s fee is reasonable. The general rule under federal bankruptcy law is that the court will hold a hearing to review a lawyer’s fee application, based on certain factors (like how much time it should take to perform the services multiplied by the usual hourly rate). But many bankruptcy courts streamline this approval process by establishing guidelines for flat fees (usually called “presumptive” fees) that the judge will presume to be reasonable. If your lawyer agrees to represent you for the presumptive amount or less, the court will automatically approve the fee without looking at the specific circumstances of the case—which is why it’s sometimes called a “no look” fee. The presumptive fee guidelines may also spell out additional fees when the cases involve certain types of property or debts, as well as the services that should be included in the basic fee.
Where bankruptcy courts have established fee guidelines, most attorneys use them to set their own fees. However, a presumptive fee isn’t an absolute maximum. Lawyers can file a detailed application to request a higher fee for cases that will require more work than usual. Also, if a case becomes more complicated than originally expected, the attorney can ask the court to approve additional fees for further services that are required. Some of the court’s guidelines include presumptive amounts for some of these services (such as filing plan modifications or motions).
Presumptive Fee Guidelines in Florida Bankruptcy Courts
We’ve reviewed some of the Chapter 13 fee guidelines issued by bankruptcy courts in Florida districts (or discussed in court orders or opinions). The fees our readers told us they paid—typically from $2,500 to $3,500—fall in line with the maximum amounts recommended by the courts in Florida.
Courts may change their guidelines at any time, so it’s a good idea to check with your local court to get the latest information. Use the government’s court locator tool to find the website and phone number for the bankruptcy court in your area. (Because the guidelines can be difficult to find, your best bet may be to call the court and ask.)
Northern District of Florida
- $4,000 for a “routine” case
- an additional $500 fee for filing a modification that increases the plan, and
- $250 for preparing annual statements.
Middle District of Florida
Some of the divisions in the Middle District of Florida have different policies for presumptive attorneys’ fees in Chapter 13 cases.
Tampa and Fort Myers Divisions. These two divisions, which cover most counties in southeastern Florida, have established the following presumptive fees:
- $3,875 for cases with three-year repayment plans
- $4,225 for cases with five-year plans
- an additional $300 fee if the non-Florida exemptions apply, and
- $300 for filing certain motions (or $400 if a hearing is required).
The guidelines provide a method for calculating the additional increase for cases with plans that last between three and five years.
Orlando Division. According to a bankruptcy court opinion, this division allows the following presumptive fees:
- $4,500 for the basic services through the confirmation of the Chapter 13 plan, and
- an additional “monitoring fee” (ranging from $20 to $50 per month) for routine work that’s necessary after the plan is confirmed.
Southern District of Florida
- $3,500 base fee, and
- additional fees for certain services ($500 for filing a plan modification and most types of motions, or $750 for filing a motion to value real property).
The guidelines spell out the services that must be included for the base fee. They also set limits on reimbursement for certain types of expenses without filing a separate application.