How Much Will a Foreclosure Lawyer Cost?

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What Will a Foreclosure Lawyer Cost Me?

Foreclosure can be one of the most difficult decisions a homeowner makes. Not being able to keep up with mortgage payments is one thing, but not understanding how much it may cost to defend against foreclosure or ensure it is done fairly can make matters much worse. Depending on the type of foreclosure, the typical attorney’s fees will range anywhere between $1,500 - $20,000.

What Factors Cause Foreclosure Costs to Vary?

How much a lawyer charges will certainly be a factor in the cost of a foreclosure. However, there are many other considerations ultimately determine how expensive the process will be. Below is a general lay out of the costs typically associated with home foreclosure:

What Goes into Determining a Lawyer's Fees?

The primary reasons for the large disparity in the cost of a foreclosure are:

Generally, foreclosure lawyers either bill through a flat fee or by the hour. If a lawyer charges a flat fee, expect to pay $1,000-$4,000. There is a common misconception that a lower fee may indicate a low quality legal representation, however nothing could be further from the truth. A lower fee is simply an assessment of what work the lawyer expects to do with respect to the difficulty of the case.

Thus, if a foreclosure is going to be quick and relatively straight forward, a lawyer will likely charge a lower flat fee. By contrast, if the borrower is adamant about continuing to live in the house, or is otherwise putting forth difficult foreclosure defenses, the fee will likely be higher.

Why Would Lawyers Charge an Hourly Fee?

Hourly rates typically vary depending on the skills and time restraints of the lawyer. Expect to pay $100-$500 an hour for a lawyer’s time. Remember, similar to a lower flat rate, a lower hourly rate is in no way indicative of the quality of representation. In fact, the opposite may be true; a lower hourly rate may reflect the lawyer’s analysis that a case will be long, and with several complicated defenses, meaning many, many hours will be required to reach result that is favorable to their client. Thus, charging a “lower” hourly fee is simply taking into account how costly the overall case may be, and a lower fee may be the only way to ensure a case remains affordable for a client.

A lawyer who works on an hourly rate may also require the payment of a retainer. A retainer covers a set amount of a lawyer’s time, and after the retainer is expended, a standard hourly rate will apply. For example, if the lawyer requires a retainer of $3,000, and bills at a rate of $150 an hour, then that retainer will cover 20 hours of the lawyer’s time.

With an hourly fee structure, it is not uncommon for legal bills to get into the $10,000 - $15,000 range quickly. Thus, this type of billing system is most common where a complicated foreclosure defense will be employed, or where a home is quite valuable and the owners do not want to lose it.

Which Fee Structure Is Best?

The best fee structure is the one that best suit your needs, and foreclosure lawyers understand that. It is always a good practice to learn more about what you are paying for, and having a better idea of what a foreclosure will cost you when you go in for an initial consultation will better situate you to start a dialogue with your lawyer about their fee structure and why they use the one they do.

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Last Modified: 01-31-2017 02:48 AM PST

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