The phrase “time is money” is especially apt when discussing attorney’s fees. The vast majority of legal matters are billed on an hourly base. In the Chicago area, most legal services run between $200 and $300 per hour of attorney’s time.
Certain practice areas, such as consumer bankruptcy, are an exception. These areas usually involve a flat fee. A flat fee is a certain amount promised in exchange for the attorney’s commitment to perform certain actions, such as filing a bankruptcy case.
A quick internet search will yield advertisements of “$795 Chapter 7 Bankruptcy.” Attorney’s fees can range from $800 to $3,000 or more for a Chapter 7 case. Why such a range? What is the money buying?
On its face, a Chapter 7 bankruptcy filing looks like a simple thing. One file some papers listing assets and income, meets with the bankruptcy trustee, and then 90 days later the court issues the discharge. In an ideal situation, that is exactly what happens. Many bankruptcy cases can be that simple.
However, many cases are far from simple. People who are self-employed, are independent contractors, have multiple properties, have multiple vehicles, have merged or blended households, have grandchildren or adult children living at home, have tax liability, have a high amount of debt (over $25,000), or other factors may have cases much more complicated than the typical case. If your case is complex, the law firm you hire may not have the experience to handle the case, and if things go wrong in your case, they may not be able or willing to represent you.
The difference in attorney’s fees can often come down to experience with these more complicated matters. Some firms may offer a low price, but make it near impossible to actually speak with your attorney – if you call with questions, you may only be able to call on certain days, or you may speak with receptions, clerks, or paralegals only. An attorney may not even be assigned to your case.
Other firms may be too small to have enough attorneys to cover all their cases, and may pay other firms to attend court for them. You may never meet the same attorney twice, and the attorney who comes to court for you may not even be a member of the same law firm you hired!
That is not to say that a small or inexperience lawyer cannot help you file for bankruptcy, or that there is anything wrong with having outside attorneys cover matters for a firm. However, as a client you should know who you are hiring, whether they have the experience to handle your matter, and how easy it will be for you to ask questions during the course of your case.
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