Find Bankruptcy Lawyers Near You in Cambridge, MA

The typical cost for a Chapter 7 bankruptcy case in Massachusetts includes a $338 court filing fee and attorney fees ranging from $1,200 to $2,500. For Chapter 13, the filing fee is $313, and attorney fees generally fall between $3,000 and $5,000. Many attorneys in Cambridge offer payment plans, allowing you to pay the fee in installments before filing. Some Chapter 13 attorneys structure their fees to be paid through the court-approved repayment plan over three to five years. For those with limited income, the court may grant a fee waiver or allow installment payments of the filing fee. Pro bono legal services are available through organizations like the Volunteer Lawyers Project for individuals who meet income guidelines.

This information is general and does not constitute legal advice. Bankruptcy laws and fee structures can change, and your specific circumstances may affect costs. You should consult with a qualified bankruptcy attorney in Massachusetts to discuss your case and obtain accurate fee information.

Bankruptcy law in Cambridge, Massachusetts, provides individuals and businesses with a legal pathway to address overwhelming debt. The practice centers on three primary chapters under the United States Bankruptcy Code. Chapter 7, often called liquidation bankruptcy, is designed for individuals and businesses with limited income who cannot repay their debts. In a Chapter 7 case, a trustee sells non-exempt assets and distributes the proceeds to creditors, and most unsecured debts are discharged. Chapter 13, known as reorganization bankruptcy, is for individuals with regular income who can commit to a three-to-five-year repayment plan. This chapter allows debtors to catch up on mortgage arrears, car loans, and other secured debts while keeping their property. Chapter 11 bankruptcy is typically used by businesses, including partnerships and corporations, to reorganize their debts and operations, though high-income individuals with debt exceeding Chapter 13 limits may also file under this chapter. The right chapter depends on your financial situation: Chapter 7 suits those below the median income with few assets, while Chapter 13 works for those with steady income who want to protect assets like a home or vehicle.

Massachusetts bankruptcy law incorporates specific state exemptions that can significantly impact what property you keep. The Commonwealth permits debtors to choose between the federal exemption system and the Massachusetts state exemption system, but you cannot mix exemptions from both systems. The Massachusetts homestead exemption is particularly generous: under Massachusetts General Laws Chapter 188, Section 1, you can exempt up to $500,000 of equity in your primary residence if you file a declaration of homestead. Without a recorded declaration, the automatic exemption is $125,000. For vehicles, Massachusetts allows an exemption of up to $7,500 in equity under M.G.L. c. 235, s. 34. The state also offers a wildcard exemption of $1,000 for any property, plus an additional $500 for each dependent. Other notable state exemptions include up to $3,000 in household furnishings, $5,000 in tools of the trade, and $1,000 in books and wearing apparel. These exemptions are adjusted periodically, so consulting current Massachusetts statutes is essential for accurate planning.

The means test determines eligibility for Chapter 7 bankruptcy and is a critical step in the process. This test compares your household income over the six months preceding your filing to the median income for a household of the same size in Massachusetts. As of 2024, the median annual income for a single-person household in Massachusetts is approximately $75,000, for a two-person household about $95,000, for a three-person household around $115,000, and for a four-person household roughly $135,000. These figures are updated periodically by the U.S. Trustee Program. If your current monthly income falls below the median, you automatically pass the means test and qualify for Chapter 7. If your income exceeds the median, you must complete a detailed calculation of your disposable income after deducting allowed expenses, such as housing, transportation, food, and taxes. If your disposable income over five years is less than $7,700, you still qualify for Chapter 7. If it exceeds $12,850, you are presumed to have sufficient income to repay creditors and will likely be required to file Chapter 13 instead. The means test is a complex form, and errors can lead to dismissal or conversion of your case.

When you file for bankruptcy in Cambridge, the automatic stay goes into effect immediately. This court order stops all collection activities, including phone calls from creditors, wage garnishments, foreclosure proceedings, repossession actions, and lawsuits. The automatic stay provides immediate relief and gives you breathing room to work with your attorney. The timeline from filing to discharge varies by chapter. For a straightforward Chapter 7 case, the process typically takes three to six months. You must attend a meeting of creditors, called a 341 meeting, about 30 to 45 days after filing. The trustee and any creditors may ask questions about your assets and debts. Approximately 60 days after the 341 meeting, the court usually issues a discharge order, eliminating most unsecured debts. For Chapter 13, the timeline is longer: you propose a repayment plan, which the court confirms after a hearing, and you make monthly payments for three to five years. After completing the plan, the court grants a discharge. Before filing, you must complete a mandatory credit counseling course from an approved provider, and after filing, you must complete a debtor education course before receiving your discharge. These courses cost between $10 and $50 each and can be taken online or by phone.

The costs of filing bankruptcy in Massachusetts include court filing fees and attorney fees. The filing fee for Chapter 7 is $338, and for Chapter 13 it is $313, as of 2024. These fees are set by the federal courts and are non-refundable. If you cannot afford the filing fee, you may request to pay in installments or apply for a fee waiver based on income below 150 percent of the federal poverty guidelines. Attorney fees vary widely based on the complexity of your case and the chapter you file. For a simple Chapter 7 case in Cambridge, attorney fees typically range from $1,200 to $2,500. For Chapter 13, fees are higher, often between $3,000 and $5,000, because the case requires more work over a longer period. Many attorneys offer payment plans, allowing you to pay the fee in installments before filing. Some attorneys require full payment before filing Chapter 7, while others may accept partial payments. For Chapter 13, attorney fees are often paid through the repayment plan itself. If you cannot afford an attorney, pro bono resources are available. The Volunteer Lawyers Project of the Boston Bar Association provides free legal assistance to low-income residents in bankruptcy cases. Additionally, the Massachusetts Bankruptcy Court maintains a list of approved credit counseling agencies and pro bono legal clinics.

Life after bankruptcy involves both challenges and opportunities for rebuilding your financial health. A Chapter 7 discharge remains on your credit report for ten years from the filing date, while a Chapter 13 discharge stays for seven years. This does not mean you cannot obtain credit during that time. Many creditors view a discharged bankruptcy as a fresh start, and you may receive offers for secured credit cards or auto loans soon after discharge. To rebuild credit effectively, start by obtaining a secured credit card, where you deposit cash as collateral. Use the card for small purchases and pay the balance in full each month. After six to twelve months of on-time payments, you may qualify for an unsecured card. Keep your credit utilization low, ideally below 30 percent of your available limit. Monitor your credit reports from Equifax, Experian, and TransUnion for errors, and dispute any inaccuracies. Not all debts are discharged in bankruptcy. Student loans are presumptively non-dischargeable unless you can prove undue hardship in an adversary proceeding, which is difficult to win. Most tax debts, especially income taxes less than three years old, survive bankruptcy, as do child support and alimony obligations. Debts for personal injury caused by driving under the influence, fines and penalties owed to government agencies, and debts not listed in your bankruptcy schedules also remain. Understanding these limitations helps you plan your financial future with realistic expectations.