When obtaining legal representation, you will most likely be charged a retaining fee. This is money paid in advance to a third party which acts as a downpayment and commitment for future legal services. In other words, lawyer retainer fees are meant to pay for the initial costs of work done on the client’s behalf. This does not mean it will cover those costs in full, nor does the payment act as a guarantee of outcome. These monies are simply held in an account and used to pay legal fees, as they are incurred.
How a Retainer Fee Works
As an example, an initial $1000 charge will cover lawyer retainer fees. The $1000 will be deposited in a trust account to be drawn on as needed. For an attorney charging $200 per hour, this payment will pay for up to five hours of services. For any additional costs associated with representation, the lawyer or the legal firm will bill the client, usually on a monthly basis.
In this same example, if the client’s case is resolved with less than five hours of legal services, the lawyer or the legal firm would refund the remaining retainer fee in a timely manner.