Legal Question in Bankruptcy in Texas

Insufficient Checks and Bankruptcy

This is a very tricky question. I am answering it in the context of a Chapter 7. Yes, a chapter 7 will discharge the "debt" created by insufficient checks; however it will not affect the criminal penalties associated with the checks. Its a catch-22 because the companies can still press charges for bad checks even though a bankruptcy relieves you from the responsibility of paying them. The bankruptcy says you don't have to pay, the company says if you don't, we'll press charges. The exception is that ultimate objective of the criminal proceeding cannot be to collect the money, but that is a subjective question of intent that is hard to prove. Thus, in order to avoid the criminal penalty, you must pay the checks. Also, the automatic stay associated with filing a bankruptcy that prevents any court actions to be instituted or continued does not operate in the context of a criminal proceeding. Few people know that, but you run the risk that they do. I hope this helps.

Part 2 of Your Questions

As to your question re the fees, the filing fee for a chapter 7 is $175 and for a chapter 13 is $160. The bankruptcy court allows you to pay a portion up front ($75 for a 7 and $60 for a 13) and divide the rest into 3 monthly payments upon an application asking for such consideration. This is only the filing fee part. Lawyer's fees for preparing a bankruptcy vary and it will be up to the individual attorney as to what kind of payment arrangements they are willing to make.