As an individual or small business owner struggling with thousands of dollars in credit card debt, outstanding business lines of credit, or old loans you just can’t seem to shake, you’re likely fed up. Perhaps you’re struggling to make your minimum monthly payments each month, forgoing essential purchases just to keep interest charges, late fees and other penalties from ballooning your already-unmanageable obligations.
If you doubt your ability to keep it up for much longer, you need to get help from a credit relief professional.
With more and more business owners and consumers struggling to stay afloat, debt settlement lawyers are in high demand these days. People everywhere are wondering, “What is the price of an attorney for debt settlement?” You may be one of these people. Debt settlement attorneys can’t cost too much, you might think. After all, aren’t they in business to help hard-working folks who don’t have a great deal of extra cash?
You’d be wrong. Debt negotiation attorneys aren’t expensive compared to other legal professionals, but they’re not cheap either. Over the life of a typical lawyer-led debt settlement program, perhaps three or four years, you’ll be asked for several different forms of payment that taken together will total thousands and seriously cut into any savings you see from your settlement.
At your first meeting with your new lawyer, you’ll be asked to pay an up-front retainer fee of 5 percent of your total outstanding debt. If you owe $20,000 in the aggregate, you’ll need to part with $1,000 in cash before your initial debt consultation for the privilege of meeting with your attorney.
This is a standard practice among lawyers, but usually the individuals or corporations being asked to pay the retainer fee have deeper pockets than someone who’s struggling to make their minimum monthly credit card payments every month. If you ask your debt negotiation attorney why they levy this up-front “consultancy fee,” they’ll typically deflect the question by noting that they apply it to the final “settlement fee” that they charge once your debt settlement program has successfully terminated three or four years hence.
Don’t buy it. You’re still going to be out the money for a long time, if you even get it back at all.
Once your case is opened and you’ve agreed upon a payment plan with your attorney, he or she will get to work negotiating settlements with each of your creditors. This can take several months, depending on how busy your representative is.
During the negotiation period, as well as the pay-off period following final settlement of your debts, you’ll be charged a monthly “account maintenance fee” of $50 or so. While this doesn’t sound like a lot in the context of a $10,000 or $20,000 debt, it can quickly add up. 36 of these monthly payments will set you back $1,800.
So far you’ve paid 5 percent of your total outstanding debts, money that could have been used to pay down those debts directly, and three or more years’ worth of $50 monthly maintenance fees. You’re already thousands of dollars in the hole and you still haven’t seen a dime in real savings.
Don’t worry, success rates for this kind of debt relief negotiation hover between 70 and 75 percent, and fewer than 25 percent of clients drop out of the program before they successfully complete it. You’ll probably see significant savings, perhaps 50 percent or more of your outstanding obligations, from your debt negotiation lawyer.
But the kicker is the final cost of this success. The typical debt negotiation lawyer charges a “success fee” of 25 percent of your total settlement savings. If your lawyer is able to save you $10,000 on a $20,000 debt, you’ll owe him or her $2,000.
What is the price of an attorney for debt settlement?
It’s not cheap. Assuming you have an outstanding debt of $20,000 and receive a settlement of $10,000, let’s review your expected expenses. First, your consultancy fee: five percent of $20,000, or $1,000. Next, your monthly account maintenance fee: $50 over an average of 36 months, or $1,800. Finally, your settlement fee: 25 percent of $10,000, or $2,500. Add these together and you’ll owe your friendly debt negotiation attorney $5,300, or more than half of the total amount you’ve saved!
There is another way:
Debt consolidation through settlement, which eschews upfront fees and expensive lawyers, charging hard-working clients like you nothing until a final settlement has been reached. All unsecured debts, like credit card bills and business loans, are fair game. Call in or fill out the convenient online form to schedule a free debt analysis and get your finances back on track without an attorney.