When you are involved in an accident, often times you are immediately thrust into the legal scene. You are bombarded with all kinds of new information and need to know how to make decisions that are in your best interest. Understanding the different types of attorney fees will help you know what to expect when you hire an accident lawyer and enable you to navigate the legal waters more smoothly.
It is important to know when a contingent fee percentage will be calculated, as contingent fees generally do not cover additional expenses, such as court costs. Therefore, you should ask your attorney if the agreed contingent fee will be calculated after related expenses have been deducted from your settlement or before. Keep in mind that your lawyer will receive less money if the contingent fee is deducted after additional expenses have been subtracted from your award money as this reduces your total recovery amount.
Flat fees are another way lawyers can choose to be compensated for their time. A flat fee is a predetermined set amount of money a lawyer will charge you for his or her services. Flat fees are generally employed when a case is simple or routine. For example, flat fees are often used for drafting simple wills. As with the contingent fee, flat fees often do not cover additional expenses, such as photocopies and phone calls. Make sure you ask your attorney how these related costs will be applied to your bill.
Another fee arrangement utilized by lawyers is an hourly rate. When a lawyer charges you an hourly rate, you will be billed for each hour your attorney works on your case. In some cases, an attorney will charge a higher rate for court work hours and a lesser hourly rate for time spent researching and preparing for your case. Also, some attorneys will charge you an hourly rate until a prearranged maximum amount of costs has been reached.
When an hourly rate is charged by an attorney, keep in mind that the overall time spent on your case will be reduced if you have an experienced attorney representing you. As with all fees, be aware that additional out-of-pocket expenses may not be covered in the hourly rate. Be sure to ask your attorney what these additional expenses may be and how they will be charged to your account.
When discussing fees with your attorney, always ask for a written agreement of the terms. In addition to having the fee arrangement in writing, you should also ask your attorney about a payment schedule and how and when they want to be paid. All fees will be carefully documented by your attorney and you may contest your bill if the charges fall outside of your fee agreement.
It is also important to know that all types of fee schedules are negotiable as there is no standard percentage charged for contingent fees. There is also no standard hourly rate or flat rate charged by all attorneys. This being the case, it never hurts to ask if your attorney is willing to negotiate their fee. Often times, an attorney will be willing to reduce their fee if your case is exciting or if you have a lot of damages pending. If an attorney wants your business, they are usually inclined to negotiate a lower fee. For flat rates, it is harder to negotiate the fee as these are often simple legal transactions that the attorney encounters frequently. If you desire to negotiate a flat rate, your best option is to tell the attorney that you are in no rush and they can work on your business at their leisure. Attorney’s may consider lowering their flat rate if they do not have to prioritize your work.
One last word on negotiating fees. While it is always a good idea to ask if your attorney is willing to work for you at a reduced rate, be careful not to negotiate the rate to a level where it is not worth the attorney’s time to work diligently on your case. Ethically, if a lawyer agrees to a rate lower than their usual fee it should not affect their commitment to your case; however, be aware that when you negotiate fees to a baseline level, you just may be negotiating yourself to a second-class client.