One main question that attorneys get from potential clients is what is the cost to retain an attorney? How much will they owe up front? What if the attorney does not get them any type of compensation? While there is no one way to answer this question as many attorneys handle their fees differently, there is a common breakdown among the type of services provided and how attorneys are typically paid:
1. Contingency Fee
When an attorney handles a personal injury case, they generally work on a contingency basis which means that they are only paid if they are able to obtain compensation. This means that you will not pay your attorney any money up front; rather, they will simply take their fee out of any recovery that is had at the resolution of your case.
2. Hourly Rate
Attorneys who handle matters such as divorce, criminal defense, immigration, bankruptcy or transaction work, will typically bill clients by the hour. This means that the attorney will set forth a specific hourly rate for the work to be completed and then will bill the clients on a designated basis whether that be monthly or biweekly.
3. Flat Fees
Flat fees are typically charged by attorneys for routine matters in which they can calculate in advance approximately how much time it will take them to perform the requested work.
One other model of payment for attorneys is a retainer fee. A retainer fee is essentially an agreed upon lump sum of money paid to an attorney before they start working on a legal matter for a client. One reason to have an attorney “on retainer” is if the individual or business needs the attorney for a legal reason in the future, they are guaranteed to have that attorney or work available to them.
While this is not an exhaustive list of how payments are made to attorneys for their legal work, it is a start to breaking down the various ways in which attorneys are paid for their work.