Written by the Upsolve Team.
Updated July 27, 2020
Living in the fourth-largest city in Texas is expensive. When living somewhere with a high cost of living, even responsible and hardworking people can easily find themselves reeling financially from a job loss, the loss of a loved one, an expensive medical diagnosis, or a serious accident. If you are dealing with creditor harassment and the constant stress that accompanies being in debt that you can no longer creatively manage, know that you are not alone. Many residents of Silicon Hills find themselves in the same position through no fault of their own. Thankfully, filing bankruptcy in Austin can erase many of your debts so that you can stop living in a constant state of anxiety about where your next month’s debt payments are coming from.
You may be unsure about whether Texas bankruptcy is right for you. Closely examining your finances can help you make an informed decision about filing bankruptcy and which kind of bankruptcy may work best for your family. Every family has unique income, debts, expenses, and assets. Therefore, the best option for your family may not be the best option for your neighbors and their families. For example, filing bankruptcy under Chapter 13 restructures your debt. This reorganization process makes it easier to consistently make monthly debt payments. This is a great option for families who can pay some of their debts but would benefit from a lower monthly payment. Filing bankruptcy in Austin under Chapter 7 eliminates many kinds of debt very quickly so that they no longer have to be paid back. If you don’t make much money or own a lot of expensive property, this may be an excellent option for your family because it eliminates the need to make a substantial monthly debt payment. Depending on your financial situation, you may no longer need to make a monthly debt payment at all.
Austin Bankruptcy Lawyers – Estimated Cost
Understandably, some individuals considering bankruptcy become preoccupied with the question: “How much does an Austin bankruptcy lawyer cost?” Filing bankruptcy in Austin doesn’t always require the help of an attorney. Specifically, if you’re filing under Chapter 7 and your finances are relatively straightforward, you don’t make much income and don’t have much property, you can opt to file without an attorney. However, you can hire bankruptcy help in Austin if you’d prefer to benefit from the assistance of a legal professional. The cost of a bankruptcy lawyer in Austin runs between $975 - $2,000. If you want an attorney’s help, consider scheduling a risk-free consultation with a few candidates. That way, you can get your questions answered before deciding on a plan of action and committing to a specific lawyer’s services.
How to File Bankruptcy in Austin, Texas for Free
If you’re interested in learning more about Chapter 7 bankruptcy in Austin, please review the following information about completing your bankruptcy documents, participating in debtor education, and the Texas bankruptcy process generally. If you are a member of a lower-income household, you’ll likely be able to complete this process without having to manage the expense of hiring an attorney.
Collect Your Austin Bankruptcy Documents
If you decide to file bankruptcy on your own, you’ll need to fill out several required forms before your process is complete. Think of filing bankruptcy in Austin as an exercise in convincing the Court that your financial situation makes it impossible for you to pay your creditors right now. To be granted debt-relief under Chapter 7 bankruptcy in Austin, the Court will need to understand why you can’t pay back your creditors over 5 years under a Chapter 13 repayment plan. To tell the Court your financial story, you’ll need access to accurate information about your income, expenses, and debts. Before you fill out your bankruptcy forms, gather any pay stubs and bank statements from the past few months. These documents will help you provide the Court with accurate accounting of your income and expenses. You also may want to request a free copy of your credit report. This document will give you easy access to a list of your current debts and creditors.
Take Credit Counseling
If you join friends for a night out anywhere in Austin, you will almost certainly overhear “armchair coaching” of the Spurs or the Longhorns. Good coaching is critical to the success of sports teams. Similarly, good credit counseling is often critical to the success of Austin bankruptcy cases. Convenient online credit counseling helps to make sure that you understand all of your debt relief options before moving forward with a Chapter 7 bankruptcy in Austin. When researching a pre-filing credit counseling course to meet this requirement, make sure that it has been approved by the Department of Justice for the Western District of Texas (Texas has 4 distinct districts) or the Court won’t honor your efforts. You’ll end up having to sign up for additional, approved counseling before your case can move forward if your provider has not been pre-approved. You can take the course at any time in the 6 months before filing bankruptcy in Austin.
Complete the Bankruptcy Forms
When you first wondered about how to file bankruptcy in Austin, you probably didn’t anticipate that you could file without an attorney. But you also probably didn’t anticipate how much paperwork is required of someone filing “pro se” (without an attorney). If the paperwork is intimidating you, know that the forms involved in bankruptcy under Chapter 7 are almost always straightforward and attached to clear directions for each document. When filling out these forms, you’ll mainly be asked about information regarding your debts, expenses, income, and assets. Chapter 7 bankruptcy in Austin is not designed as a complex process. If you feel confident in explaining your financial situation generally and commit to following the directions for each form, you’ll do just fine.
Get Your Filing Fee
Filing bankruptcy in Austin under Chapter 7 costs $335. Don’t panic if this Court filing fee seems overwhelming. The Court will allow you to pay it in installments if you file a request to do so. If you can’t afford this fee, even when paid in installments over time, you may qualify for a fee waiver. If your income is 150% below the poverty line, you are eligible to file your case for free if the Court approves your waiver request. All you will need to do is fill out the required form and show the Court that you can’t afford to make payments, even after your Austin bankruptcy case has been filed and no longer have to make monthly debt payments to your creditors.
Print Your Bankruptcy Forms
When filing for Austin bankruptcy, you won’t be able to complete the process online. Your forms will need to be physically printed out. If you don’t have easy access to a printer, consider visiting one of the 20 local branches of the Austin public library. The library has printers available for public use for a reasonable fee. This option is likely more convenient than going to a more expensive commercial service provider like Kinkos or Office Max. As an added bonus, you can check out a good book while you’re there. You may even be able to find some resources aimed at individuals trying to rebuild their credit and financial security in the wake of filing bankruptcy.
Go to Court to File Your Forms
Whether you live and work in Tarrytown or Dawson, Moore’s Crossing or West Campus, chances are that you enjoy exploring all that Austin has to offer. You probably haven’t considered Austin’s courts as something the city “has to offer,” but it is nice that you won’t have to travel far to file your bankruptcy paperwork. Austin is part of the Western District of Texas and the courthouse where you’ll need to file your Texas bankruptcy is located at 903 San Jacinto Boulevard. Simply bring two copies of all your bankruptcy forms and a photo ID to the courthouse and tell the clerk that you’re there to file a Chapter 7 bankruptcy in Austin. You’ll be given additional directions from there.
Mail Documents to Your Trustee
When you file for Chapter 7 bankruptcy in Austin, the Court handling your case will appoint a Trustee to oversee a critical step in the bankruptcy process. Specifically, this individual will be modestly paid to review your bankruptcy petition and ask you questions while you are under oath during a so-called 341 meeting. Your 341 meeting is open to participation from your creditors, but they rarely attend these meetings for low-level cases. To prepare for this meeting, your Trustee will need to learn about your finances. Therefore, you’ll need to send necessary copies of specific documents to your Trustee before your case can proceed. Once a Trustee is assigned to your case, which usually happens a few days after filing bankruptcy in Austin, they’ll usually let you know what to send and where to send it.
Take Bankruptcy Course 2
In addition to your pre-filing credit counseling requirement, you’ll need to participate in a debtor education course at this point in your Austin bankruptcy process. You may find this course more helpful than you pre-filing credit counseling. While that class was designed to help ensure that your decision to file bankruptcy was informed, this class is designed to help you benefit from the fresh start that a Chapter 7 bankruptcy provides. Once again, make sure to only sign up for a program approved by the Department of Justice for your district so that you explicitly fulfill this Chapter 7 bankruptcy requirement. If you don’t, the Court will not grant you a discharge.
Attend Your 341 Meeting
The Court primarily obtains information about your finances in two ways before it decides whether to grant you permanent bankruptcy relief in the form of a Chapter 7 discharge. First, it examines the financial data you submit to the Court through the forms you have filled out and copies of any documents you have provided. Second, it asks the Trustee overseeing parts of your case to ask you certain questions under oath during a 341 meeting. This meeting is one of the most intimidating parts of filing bankruptcy in Austin because it means possibly facing your creditors, who are invited to attend. However, creditors rarely attend 341 meetings in person, especially when lower-income individuals are seeking to discharge relatively minor debts. As a result, you will likely just need to speak with your Trustee one-on-one, typically for no more than 10 minutes. Show up, tell the truth and remember to occasionally take some deep breaths. You’ll be fine.
Dealing with Your Car
Austin isn’t always a pedestrian-friendly city. Even though Austin is located in a milder U.S. climate, it’s not generally easy to get around without a car. When filing bankruptcy in Austin, you may be understandably concerned about how the process will affect your car or truck. If your vehicle is paid for and the full value of your car is exempt, you can keep your vehicle. But if you still owe money on a car loan, you’ll need to choose to either reaffirm your debt,redeem the car or surrender your car. The pros and cons of each option will depend on your income, your family’s transportation-related needs and your ability to reliably pay your creditors back until the terms of your loan are complete.
Texas Bankruptcy Means Test, Bankruptcy Forms, and Exemptions for Austin
Texas Means Test
To qualify for Chapter 7 bankruptcy in Austin, you’ll need to pass the Texas bankruptcy Means Test for Chapter 7. In a nutshell, the Texas bankruptcy Means Test for Chapter 7 involves comparing a household’s income and expenses to limits set by the Bankruptcy Code to ensure that the household can’t afford to pay its debts over time through a Chapter 13 repayment plan. The income limits applied to Chapter 7 bankruptcy cases are specific to each state and vary by household size. Those that don’t pass the Chapter 7 Means Test can still benefit from alternative bankruptcy options. If you don’t pass the Texas bankruptcy Means Test for Chapter 7, you may want to seek the assistance of an attorney to explore your other options.
Median Income Levels for Texas
Texas Median Income Standards for Means Test for Cases Filed On or After May 1, 2020
|Household Size||Monthly Income||Annual Income|
Poverty Levels for Texas
Texas Fee Waiver Eligibility for Cases Filed On or After May 1, 2020
Eligible for fee waiver when under 150% the poverty level.
|Household Size||State Poverty Level||Fee Waiver Limit (150% PL)|
Texas Bankruptcy Forms
When you file for Chapter 7 bankruptcy in Austin, you need to physically print your Texas bankruptcy forms as you can’t submit them online. These forms may initially seem very complex but looks can be deceiving. Don’t panic when you first browse through these legally dense forms. The directions for the forms you need are clear about every step you need to take to file for bankruptcy relief on your own. You’ll need to submit a few local forms in addition to the standard national forms. Specifically, you’ll need to file a verification of your list of creditors and a “pro se” questionnaire if you’re filing bankruptcy in Austin without the help of a lawyer.
Everyone who files for Austin bankruptcy relief gets to keep specific property safe from creditors through the process of applying exemptions to that property. To take advantage of Texas bankruptcy exemptions (and keep most or all of your property safe from your creditors), you’ll choose to take claim either federal or Texas bankruptcy exemptions, as the Court won’t allow you to “pick and choose” from both exemption models. You’ll then identify specific exemptions to protect your property.