Chapter 13 Attorney Fees and No-Look Fee Amounts

How does a Chapter 13 no-look fee actually work?

A no-look fee — courts also call it a presumptively reasonable fee, a presumptive fee, or a flat fee — is an amount the bankruptcy court in your district has said it will approve for a routine Chapter 13 case without making the attorney file a detailed fee application or produce contemporaneous time records. If the attorney agrees to the published amount, performs the services the court's rule lists, and nobody objects, the fee is generally allowed as part of the order confirming the plan. The Northern District of Indiana states the idea plainly: a set figure is presumed to be a reasonable fee in a routine consumer case, and the presumption can be rebutted if someone objects (N.D. Ind. L.B.R. B-2016-1). The purpose is administrative. It keeps routine fees out of litigation. It is not a ceiling on what a case can cost, and it does not fix what any individual lawyer charges you.

What changes the amount you end up paying?

Several things move the number. Business cases cost more nearly everywhere: the District of Columbia sets $6,750 for a standard case and $7,750 where the trustee requires a business report or the debtor holds a controlling interest in a company or LLC operating a business (D.C. LBR 2016-2). Some districts key the amount to income instead — the Western District of Missouri uses $4,100 for a below-median family income case and $4,600 for an above-median one, for pre-confirmation services (W.D. Mo. LBR 2016-2). Then there is work that sits outside the base fee: court-ordered mortgage modification mediation, motions to avoid liens, objections to claims, post-confirmation plan modifications, motions to sell or refinance property, and adversary proceedings. Districts commonly publish separate flat amounts for those services, or require a fee application with supporting documentation for anything extraordinary or unanticipated (N.D. Ind. L.B.R. B-2016-1).

What does federal law say about Chapter 13 attorney fees?

Federal law does not set a dollar amount for a Chapter 13 debtor's attorney. It sets a standard. Under 11 U.S.C. § 330(a)(4)(B), a court may allow reasonable compensation to the debtor's attorney for representing the debtor's interests in connection with the case, based on the benefit and necessity of those services and the other factors in that section. Those factors include the time spent, the rates charged, whether the service was necessary or beneficial when it was rendered, whether it was performed in a reasonable time given the complexity of the task, whether the attorney has demonstrated skill in the bankruptcy field, and what comparably skilled practitioners charge outside bankruptcy (11 U.S.C. § 330(a)(3)). The court may also award less than the amount requested, on its own motion or on the motion of the trustee or another party in interest (11 U.S.C. § 330(a)(2)). A district's no-look fee sits on top of that standard as a presumption, not a replacement for it.

Where do local court rules differ?

Almost everything about no-look fees is local: the amount, what it covers, and even where the figure is written down. Some districts put it in the rule itself — the Middle District of Pennsylvania sets a presumptively reasonable fee not to exceed $5,000 covering all services through the conclusion of the case, with additional amounts for a conduit mortgage plan or a post-confirmation modification (M.D. Pa. LBR 2016-2). Other districts deliberately keep the number out of the rule so it can be updated: Idaho sets it by General Order (Bankr. D. Idaho LBR 2016-2), Colorado by a General Procedure Order (D. Colo. L.B.R. 2016-3), Western Kentucky in the Clerk's Office Administrative Manual (KYWB LBR 2012-1), and the Western District of Michigan by a court memorandum (W.D. Mich. LBR 2016-2). Nevada uses separate Presumptive Attorney's Fees Guidelines (Nev. LBR 2016.2). State law does not set these amounts. Your bankruptcy court does.

What does this look like in practice?

Two different costs run in parallel, and they are not the same money. The court's own fee for a Chapter 13 case is $235 (28 U.S.C. § 1930(a)(1)(B)), plus a $78 administrative fee (Bankruptcy Court Miscellaneous Fee Schedule, Item 8). The statute generally permits an individual commencing a voluntary or joint case to pay the filing fee in installments (28 U.S.C. § 1930). The attorney's fee is separate from both. The common pattern in the district rules runs like this: you and the lawyer sign a written fee agreement; the lawyer states the fee and the services it covers in the plan itself (Ariz. LBR 2084-3); the plan is confirmed; and the trustee then pays the balance of the allowed fee out of your plan payments in accordance with the confirmed plan (E.D. Wis. LBR 2016-2). The trustee is compensated separately, in an amount not to exceed five percent of payments under the plan (11 U.S.C. § 326(b)).

What documents and information are involved?

Fee terms appear in several documents, and they are meant to agree with each other. Most districts require a written engagement letter or fee agreement describing the scope of the representation and the basis or rate of the fees, entered into before or within a reasonable time after the representation begins (D. Mass. LBR Appendix 1, Rule 13-7). Many condition the streamlined fee procedure on a signed Rights and Responsibilities Agreement between Chapter 13 debtors and their attorneys, filed with the court and served on the trustee (Central Guide Supplement, Chapter 13 fee chart; W.D. Mo. LBR 2016-2). The attorney also files a disclosure-of-compensation statement covering any retainer and any compensation received or agreed to within the year before filing (D. Mass. LBR Appendix 1, Rule 13-7). The plan carries the number itself: Arizona requires the plan to state whether compensation is flat or hourly, the amount, and which services are included (Ariz. LBR 2084-3). Ask for copies of all of them.

What should you ask a lawyer about fees?

Ask for the district's published amount and whether the quote matches it. Ask exactly which services the flat fee covers through confirmation and through discharge, since the rules list minimum required services in detail — reviewing financial documents, preparing the petition, schedules and plan, appearing at the meeting of creditors, resolving creditor objections, and reviewing claims (Ariz. LBR 2084-3). Ask what is excluded; adversary proceedings, appeals and trustee audits are commonly carved out for separate arrangements (D. Md. LBR Appendix F). Ask how much is due before filing and how much comes through the plan. Ask what happens if you fall behind: in Maryland, after the initial engagement the attorney may not demand payments from the debtor as a precondition to doing the work, and must remain attorney of record until substitution, court-approved withdrawal, dismissal or closing (D. Md. LBR Appendix F). Ask what the fee would be if the case is dismissed before confirmation.

Frequently asked questions

How much does a Chapter 13 lawyer cost?

Most Chapter 13 attorneys charge the published no-look fee in their district, and those amounts vary widely — $4,000 in the Northern District of Indiana, $5,000 in the Middle District of Pennsylvania, $7,000 for a non-business case in the Central District of California. Business cases, mortgage mediation and contested matters commonly add published amounts on top. The court's filing fee is separate.

Do I have to pay the whole attorney fee before filing?

Commonly not. In Chapter 13 the fee is typically split, with part paid before filing and the balance allowed as an administrative expense and paid by the trustee out of plan payments after confirmation (E.D. Wis. LBR 2016-2). Some courts scrutinise large prepetition retainers closely — the Oakland Division guidelines in the Northern District of California flag retainers of more than $2,000 for close review.

What does the no-look fee actually cover?

Local rules list the minimum services. In Arizona a flat fee requires the attorney to provide services through plan confirmation and then assist the debtor to obtain a discharge, including reviewing financial documents, preparing the petition, schedules and plan, appearing at the meeting of creditors, resolving non-adversary creditor objections, and reviewing claims (Ariz. LBR 2084-3). Coverage differs by district, so read your court's list.

Can my attorney be paid more than the no-look fee?

Yes, but generally only through a formal request. Counsel may apply for fees above the presumptive amount for extraordinary, unusual or unanticipated services, supported by documentation showing the reasonable value of the work (N.D. Ind. L.B.R. B-2016-1). Some districts also publish separate flat amounts for specific extra services, such as mortgage modification mediation or a motion to avoid a lien.

What is the court's Chapter 13 filing fee?

The Chapter 13 filing fee is $235 (28 U.S.C. § 1930(a)(1)(B)), plus a $78 administrative fee (Bankruptcy Court Miscellaneous Fee Schedule, Item 8). That money goes to the court, not to your lawyer, and it is charged whether or not you have an attorney. The statute generally permits an individual to pay the filing fee in installments.

What happens to the fee if my case is dismissed before confirmation?

District rules address this directly. In the Eastern District of Wisconsin, if the court dismisses the case without confirming a plan, counsel is allowed the presumed reasonable fee or the agreed amount, whichever is less (E.D. Wis. LBR 2016-2). In Idaho, an attorney seeking payment from funds still held by the trustee must file a detailed fee application within 14 days of dismissal (Bankr. D. Idaho LBR 2016-2).

Is the no-look fee the same in every state?

No. It is set district by district, not by state law and not by federal statute. Two districts within the same state can publish different amounts, and some courts keep the figure in a General Order or an administrative manual rather than the rule itself, so it can be revised. Check your own district's current rule or guidelines before relying on a number.

Sources

• 11 U.S.C. § 330 — Compensation of officers · official source
• 11 U.S.C. § 326 — Limitation on compensation of trustee · official source
• 28 U.S.C. § 1930 — Bankruptcy fees · official source
• 28 U.S.C. § 1930(a)(1)(B) — Chapter 13 filing fee
• Bankruptcy Court Miscellaneous Fee Schedule, Item 8 — Administrative fee
• N.D. Ind. L.B.R. B-2016-1 — Presumptively Reasonable Attorney's Fees in Chapter 13 Cases
• D.C. LBR 2016-2 — Compensation for Debtor's Attorney in Chapter 13 Cases
• U.S. Bankr. Ct. C.D. Cal., TCG Supplement: Presumptively Reasonable Fees -- Chart -- Chapter 13 Attorneys
• Bankr. M.D. Fla. Procedure Manual — Presumptively Reasonable Attorney Fees in Chapter 13 Cases
• W.D. Mo. LBR 2016-2 — Debtor's Attorney's Fee Agreements and Allowance of Compensation
• M.D. Pa. LBR 2016-2 — Compensation of Debtors' Attorneys in Chapter 13 Cases
• Ariz. LBR 2084-3 — Attorney Fees
• E.D. Wis. LBR 2016-2 — No-Look Fees in Chapter 13 Cases
• Bankr. D. Idaho LBR 2016-2 — Debtor Representation and Compensation in Chapter 13
• D. Colo. L.B.R. 2016-3 — Compensation of Chapter 13 Debtor's Attorney
• KYWB LBR 2012-1 — Chapter 13 — Debtor Attorney Fees
• W.D. Mich. LBR 2016-2 — Fee Applications
• Nev. LBR 2016.2 — Compensation for Chapter 13 Debtor's Attorneys
• D. Mass. LBR Appendix 1, Rule 13-7 — Professional Compensation Agreements; Disclosures
• D. Md. LBR Appendix F — Chapter 13 Debtor's Counsel Responsibilities and Fees
• CANB official material — Guidelines for Payment of Attorney's Fees in Chapter 13 Cases
• CANB official material — Guidelines for Payment of Attorney Fees in Chapter 13 Cases - Oakland Division 11/30/16

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