Hiring a Lawyer to Defend Against a Collection Lawsuit

If you want to hire an attorney to represent you in a creditor lawsuit, here's where to start.

By , Attorney (Tulane University School of Law)

When a creditor has sued you for the collection of a debt, you may decide to hire an attorney to represent you in the lawsuit. If you need help defending against a collection lawsuit, below are some things to think about, including:

  • how to find a good lawyer to represent you
  • how much you'll pay in lawyer's fees
  • what to expect when you first meet with an attorney, and
  • making sure you sign a retainer agreement.

Time Is of the Essence in a Collections Lawsuit

Once you've been served with a collection suit, you must act quickly. Depending on the rules for court cases in your state, you might have as few as five days to respond. The summons attached to the complaint will tell you the deadline for your response.

The court could enter a judgment against you if you don't respond. So, it's crucial that you contact an attorney immediately to discuss your rights and whether defending the lawsuit is in your best interests.

Finding a Qualified Lawyer for a Collections Case

How do you find a lawyer familiar with debt collection lawsuits? Here are some places to look:

Referrals from other lawyers. An excellent place to start is to ask any other lawyers who've helped you in the past. Most attorneys are more than happy to make a referral to someone who can help.

Referrals from friends or family. You might also consider asking relatives or friends for the names of lawyers they trust.

Online directories. Online directories can help you locate qualified attorneys in your area. Remember though, you'll have to screen each attorney yourself. The directories do not vouch for an attorney's competence. A couple to try include:

Local or state bar associations. Most local and state bar associations have lists of lawyers who practice in different areas.

Legal aid organizations. If you are low-income or receive public assistance or Social Security, or are elderly, you might qualify for representation through the local branch of the Legal Services Corporation or another legal aid organization or nonprofit law center.

Pro bono representation. Many local bar associations also have lists of lawyers willing to take cases for free or for a reduced amount if you cannot otherwise afford representation.

How Much Will It Cost to Hire a Lawyer for a Collections Lawsuit?

Many consumer attorneys will offer an initial consultation for free. At that meeting, the attorney should estimate your fee based on factors such as whether you dispute that you owe the money, whether you have a defense or a counterclaim to the lawsuit, and whether the creditor is likely to settle the case without a trial.

How an attorney charges for services can greatly affect the cost. Most attorneys will charge for their services in one of three ways:

  • A flat fee, no matter how long it takes or how the suit is resolved.
  • By the hour, often with a cap to ensure that you do not pay the attorney more than the lawsuit is worth
  • By the result. Usually, this fee is based on how much the attorney saves you in the long run. For instance, an attorney may agree to a fee of one-third of the difference between the amount of the debt and the settlement amount. If you are sued for $10,000 and settle for $4,000, the attorney will get one-third of the difference, or $2,000.

If you have a counterclaim that you can file against the creditor, such as one for illegal debt collection practices or unfair trade practices, the attorney might be able to recover his or her fees from the creditor if you win.

Most attorneys will ask you for a retainer or a down payment on the fees before they take the case. The retainer can range from a nominal amount to thousands of dollars and is usually based on how much the creditor seeks in the lawsuit and the amount of time the lawyer estimates the case will last.

What to Expect at Your Initial Meeting With the Lawyer

Set up meetings with a few lawyers to compare and contrast them. To each initial consultation, bring the lawsuit papers and any paperwork you have on the debt, including statements or correspondence you received from the creditor or any collection agencies.

What the Attorney Will Ask You

The attorney will likely ask you questions about the following:

  • how old the debt is (the statute of limitations might have passed)
  • the transaction that gave rise to the debt or the credit account on which it is based
  • the behavior of the collectors you have encountered, and
  • other facts that will help the lawyer figure out if you have any affirmative defenses or counterclaims that might reduce the amount you owe or even cause the creditor to drop the suit.

The attorney might also ask questions about your other debts to determine if it might make more sense to consider a broader solution like a bankruptcy or debt settlement.

The attorney should also discuss the fee with you, how the attorney charges, what amount will be charged, how you'll be billed, and when the attorney will expect payment. The attorney should explain any additional costs, like court fees and expenses you'll be responsible for, like copy costs, postage, and other charges.

If the attorney thinks a settlement is possible, the attorney will ask you if you have a maximum amount you are willing to pay the creditor.

What You Should Ask the Attorney

Here are some questions you should ask the lawyer.

  • How much experience do you have with cases like this?
  • How long will it take to settle the case?
  • Will you keep me informed as the case progresses? How?
  • Do you negotiate cases yourself or do you rely on your paralegal staff?

Signing a Retainer Agreement

If you decide to hire an attorney to defend the collection suit, be sure that you sign a retainer agreement. The retainer agreement is a contract that governs your employment relationship with the attorney and should spell out at a minimum the details of the fee arrangement you negotiated.

What to Expect Once the Case Proceeds

Once you've hired an attorney, it's important that you cooperate and provide the attorney with the information needed to work on your case. You should expect competence, ethical behavior, and adequate communication from the attorney as your case progresses.

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