Obtaining a large sum of money in advance to pay a lawyer is quite difficult for most people. Aside from that, most people would find it difficult to pay an attorney on an hourly basis during the full process of filing an injury claim and potential lawsuit.
Because of this, lawyers who take on personal injury lawsuits have devised an alternate payment method in which they do not seek any upfront payment from a client and instead charge their clients a percentage of the total amount of the eventual settlement or court award. Known as a “contingency” fee agreement, this type of arrangement can be immensely beneficial to both clients and attorneys alike.
Contingency costs are not inexpensive; they represent the fact that the lawyer is taking a risk and that you will not be required to pay anything in advance of the start of the case. The fee a lawyer charges in a personal injury lawsuit is typically between 33 percent and 40 percent of the amount recovered for the client.
And, after all of the expenditures are deducted, the client may end up with a settlement that is far less than the amount the lawyer received from the insurance company. Remember that you may always try to bargain the charge for a personal injury lawyer – here are some ideas on how to do so successfully.
An Example of a typical contingency fee agreement, you enter into a contingency fee agreement with a lawyer, agreeing to pay the lawyer 33.3 percent of any compensation obtained on your behalf. That 33.3 percent is calculated after the attorney has been reimbursed for any expenses incurred in the course of handling your case.
If a lawyer has spent $1,000 on costs and receives a settlement of $10,000, the $1,000 would be deducted from the $10,000, leaving $9,000 in the bank. After that, the lawyer would take 33.3 percent of the remaining $9,000, leaving you with $6,000 in your pocket.
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