How much it will cost to hire a lawyer to negotiate with your creditors can vary significantly depending on your circumstances. In most cases, how much a lawyer will charge depends on:
Generally, attorneys' fees are directly related to how much work the lawyer will have to perform. If you want to negotiate with your creditors, you might be able to hire an attorney to handle the entire negotiation process until settlement or perform a specific task related to the negotiation (called an "unbundled" service), like drafting a settlement proposal.
To negotiate with your creditors, an attorney might charge:
The following are some of the most common examples of how much an attorney might charge you to negotiate with your creditors.
Depending on how many creditors you want the attorney to negotiate with, the lawyer might charge you a flat fee to handle the entire negotiation through settlement. The fee amount will typically depend on the number and type of creditors you have. In general, average fees can range from $500 to negotiate a simple credit card debt to more than $5,000 for more complex negotiations.
The attorney might charge you an hourly fee to negotiate with your creditors. In that case, the lawyer could agree to let you pay as you go or require a retainer (a lump sum of money) to begin negotiations. An attorney's hourly rate will depend on several factors, including the amount of experience the lawyer has and where you live. In many cases, you can expect a debt negotiation attorney to charge anywhere from $125 to $350 per hour.
An attorney might base fees on the amount of debt you have. In most cases, the fee will be a specific percentage of the amount of debt the attorney will negotiate on your behalf.
Similar to fees based on the amount of your debt, an attorney might charge you a percentage of the money you'll save with the settlement. With this kind of arrangement, the attorneys' fees increase with the amount you save, which gives the attorney more incentive to get you the best possible settlement.
An attorney might charge a higher fee if:
Because attorneys' fees can vary significantly based on your individual circumstances, talk to several debt negotiation attorneys in your area to compare the fees they would charge in your case.