A debt collection lawyer is invaluable when your debt situation leads to court proceedings.
A debt collection attorney specializes in debt-related cases, representing creditors or borrowers. It is vital to choose one that fits your case.
In 2016, CFPB reported 70 million consumers contacted by debt collectors, with 17.5 million feeling threatened.
Many turn to debt lawyers to combat aggressive collectors in court.
When facing relentless debt collectors, a debt lawyer is your resource for understanding your rights and escaping harassment or illegal tactics.
Before moving forward, grasp key insights about debt collection lawyers, what to consider when hiring, and how they contrast with collection agencies.
What is a debt collection attorney?
A debt collection lawyer helps recover debts from nonpaying clients, handling paperwork and court representation.
Some may also protect debtors being sued.
When would you need to hire a debt collection attorney?
Consider hiring a debt collection lawyer in these scenarios:
- You expect your case to go to court.
If you’ve been pursuing a debt for a long time and anticipate needing a legal judgment to recover, it’s wise to hire a debt collection attorney. While you can represent yourself, a legal expert is more likely to secure a favorable ruling.
- You need to send demand letters.
If you expect a court case but prefer not to sue, use demand letters. These state your case and give clients a chance to pay to avoid legal action. A debt collection attorney can assist in crafting effective demand letters.
- Your client owes you at least $5,000.
Many debt collection experts advise hiring a debt collection attorney for debts of $5,000 or more. Generally, if the debt is significant enough to justify legal costs for court action, hiring an attorney is a smart choice.
- Your client is a large company
Large businesses have more resources to resist debt collection efforts. Debt collection attorneys are knowledgeable about how these companies may use their resources and can be valuable when pursuing corporate debts.
- You need any other sort of legal advice or assistance with debt collection.
Debt collection discussions frequently mention collection agencies. However, they can’t provide legal advice or file lawsuits. A debt collection attorney, well-versed in the laws, is the one to provide legal counsel.
What to consider when hiring a debt collection lawyer
When seeking the right debt collection attorney, take into account and evaluate the following about each candidate:
- How much does the debt collection attorney charge?
Filing a court case for debt recovery can cost hundreds of dollars, and if successful, you may owe one-third of the recovered debt and additional fees to your attorney. When choosing an attorney, inquire about their fees and assess if you can manage the court costs.
- Are the attorney’s skills appropriate for your case?
Some debt collection lawyers excel with large companies but lack experience with small business debts. Ask attorney candidates for their track records to assess their expertise. When going to court, select the lawyer with the skills best suited for your specific needs.
- Do they specialize in your debt type?
An attorney’s skill set isn’t the sole factor in determining their suitability. For instance, an attorney skilled in recovering debts from large companies may not succeed in small business equipment rental cases. Discuss your debt type with the attorney to ensure their services align with your needs.
- How do they handle communication?
Lawyers are often busy, but their schedules shouldn’t hinder communication. While you’ll gauge your potential attorney’s communication style during your search, the initial impression has limits. Explicitly inquire about the frequency of updates and ensure it aligns with your expectations.
- What do their references say about them?
A reliable debt collection attorney should provide references, ideally past clients, and facilitate contact with them. Use the information from these references to assess if the attorney is a good fit for your needs.
- Do they work independently or within a firm?
Independent lawyers may choose to work outside firms to have greater control over their strategies. However, they might lack the resources, including time, that larger firms can provide.
- Will they actually represent you in court?
Debt collection attorneys can handle court representation, but not all of them do. Some work as consultants and avoid court. To avoid surprises, ensure your attorney’s courtroom presence matches your needs.
Handling difficult debtors requires a strategic approach, including record-keeping, communication, negotiation, and legal remedies.
Hiring a debt collection attorney is highly beneficial due to their expertise, compliance, recovery capabilities, time and resource savings, and legal protection for successful debt collection.