The Pros and Cons of Contingency Fee Agreements
The services that a lawyer provides can be pricey. If you can’t afford to pay the law firm following a debilitating brain injury, you may decide to hire a brain injury lawyer who works under a contingency fee agreement. What is a contingency fee agreement and is it better than hiring a lawyer at a per-hour rate? Seasoned attorney, Barry P. Goldberg can explain a few of the pros and cons of contingency fee agreements.
First, What is a Contingency Fee Agreement?
With a contingency fee agreement, you don’t pay your lawyer up front, and if you lose the case, you won’t be charged so much as a penny for the hours the lawyer worked. There is no hourly rate, no upfront fees, and no hidden costs. How is the lawyer paid for their work, you might ask? The fee comes from a percentage of the compensation you receive if you win your case. In short, if you lose, neither you nor your lawyer receive anything. If you win, you and your lawyer split the profits.
What Are the Pros of a Contingency Fee Agreement?
A contingency arrangement allows you to hire a lawyer relatively free of risk. If you lose your case, you’re in the same place. You haven’t lost any money in upfront fees or hourly rates, and you aren’t responsible for any costs incurred by your lawyer in handling your case. You are only required to pay your lawyer in the event that you win a settlement and you have the money to cover the fee.
What Are the Cons of a Contingency Fee Agreement?
Most personal injury lawyers take about a third of the settlement, and some contingency arrangements allow the lawyer to take up to 40% of your settlement. Your settlement will also pay for the costs your lawyer incurred in handling your case, and the contingency fee is deducted from your settlement after the lawyer has been compensated for those costs. This can leave you with little more than half of your settlement, and depending on the amount you received, the contingency fee can add up to far more than you would have paid your lawyer per hour.
If you are paying a law firm through a contingency fee agreement, it’s good to understand the pros and cons ahead of time. Talking with a lawyer that specializes in cases involving brain injury can help you better understand what is expected in terms of payment and whether a contingency arrangement will work for you.