Filing for bankruptcy is never two things: cheap or easy. Along with the financial hardships imposed by the court and the lasting impact on your credit score, bankruptcy often costs a lot of money. Hiring a competent bankruptcy attorney to help you through it requires an investment you may not be able to make. You'll need to know what to take advantage of to make the process go as cheaply as possible.

The Cheapest Way to File a Bankruptcy

Determine if it is a personal or company bankruptcy. Individuals have the right to file for bankruptcy pro se, that is, without the assistance of an attorney. Business organizations, however, do not. Partnerships, limited partnerships, limited liability companies and corporations must all have an attorney in order to file for bankruptcy.

Choose between Chapter 7 or 13.

Choose between Chapter 7 or 13. Personal bankruptcy is generally divided into two kinds; Chapter 7 provides for a liquidation of assets, paying off creditors and eliminating any debt remaining. Chapter 13 provides for a restructuring of debt and a payment plan so the debtor can pay back all or some of the owed funds. Strictly speaking, the cheapest way to file for bankruptcy is to file a Chapter 13 petition. However, this has very little impact on the total cost of the bankruptcy.

Pay the filing fee.

As of 2009, Chapter 7 filings cost $299, while Chapter 13 filings cost $274. This is a very slight difference and should play little part in your decision to choose between the two. The $25 you save may not be worth it, depending on the nature of your financial situation and how you wish to emerge from the bankruptcy.

Do it yourself, or get a lawyer.

Yes, lawyers are expensive. Yet bankruptcy cases can be so complex that hiring an attorney who knows what to do will probably, in the long run, save you money. How? Because an attorney will be able to advise you on what choices you should make. You can file your own bankruptcy pleadings and manage to get through the process in one piece, but that doesn't mean you'll be in the best possible position. These choices will not only affect your immediate financial position, but will also affect what happens to you 10 years down the road. Saving money in the long term, instead of saving a few dollars now, is usually the best way to go.

Source:

USCourts.gov: Bankruptcy Information Online

USCourts.gov: Bankruptcy Filing Fees

USCourts.gov: Bankruptcy Forms

More Information:

FTC.gov: Consumer Bankruptcy Advice