A $3,000 Fee

The copy of the check shown above dated July 15, 2008 represents the balance of a $3,000 fee I recently earned (less $100 for a retainer I had already received). Here's how the case played out...

During a regular courthouse visit, I came across a case where an insurance company had brought a lawsuit against a trucking company for past premiums due on a policy. The lawsuit was for $80,059 plus attorney fees, back interest on the debt and court costs of $317 for filing the suit.

I sent a letter to the debtor business (defendant) at the address shown on the lawsuit and followed with a phone call a few days later. Once the owner of the company heard I was offering to settle out-of-court at a discount on a no results / no charge basis, he agreed to let me try. I got his side of the story & immediately faxed over an agreement for him to sign.

Although he had some dispute with the amount the insurance company claimed was due, this was basically a result of being short on funds to pay the debt in full in one lump sum. The owner gave me some general guidelines on what he could afford. HINT: clients will often give you a much lower amount than they can really afford thinking that will save them some money.

I quickly sent the attorney for the insurance company a low-ball offer of $29,200 (a hefty 63% discount), payable in 23 monthly installments of $400 with a balloon payment in the 24th month of $10,000. She rejected this offer but after a couple of counters she indicated she would accept $56,042 payable in 24 monthly installments of $2,483.82 bearing an interest rate of 6%. The settlement would be secured by an Agreed Judgment (see previous blog post). I saved my client over $21,000 even after he paid my fee! Although my fee was based on savings on the principal amount of the debt, I also saved him attorney fees which could have amounted to 1/3 of the debt (another $26,600).

Now, for this case, I had initially set my fee at 25% of savings rather than my usual 30% for 2 reasons: first, I knew what to expect from this creditor from dealing with them over the years, second, I knew my fee would be well in excess of my cap of $3,000 even at 25%.

There were some delays involved since the creditor requested financial information from my client in order to justify the discount but everything was completed within about 6 weeks and only took a couple of hours of my time.

This is only one example and these cases are filed all over the country, every week. Of course, while I was working this case, other cases were being worked and fees were being received. Keeping your pipe line full of cases and constantly prospecting for clients through courthouse searches and referral networking will ensure you a steady stream of fees.

The business is always out there and, using my proven techniques, YOU CAN GET IT!

Scott F. Soape