When invoices go unpaid or borrowers default, businesses often turn to collections attorneys to help recover the money they’re owed. Unlike debt collectors, a collections attorney can escalate matters legally—through lawsuits, judgments, wage garnishment, and asset seizures.
In this guide, we’ll explain:
- What a collections attorney does
- How they differ from debt collectors
- When to hire one
- What to expect in terms of cost and process
- Tips to improve your debt recovery strategy
What Is a Collections Attorney?
A collections attorney is a licensed lawyer who specializes in debt recovery and creditor rights. They represent individuals or companies seeking to collect overdue payments, whether from consumers or other businesses.
Unlike standard debt collectors, a collections attorney can:
- File lawsuits on your behalf
- Secure court judgments
- Enforce wage garnishments
- Place liens on property
- Seize bank accounts or assets
They are often used in B2B (business-to-business) debt recovery, large unpaid debts, or disputed claims.
Collections Attorney vs. Debt Collection Agency
| Feature | Collections Attorney | Debt Collection Agency |
| Legal authority | Can file lawsuits and go to court | Cannot take legal action |
| Licensed professional | Must be a practicing attorney | Often agents or agencies |
| Negotiation & settlement | Can structure legal agreements | Can attempt informal settlements |
| Best for | Large, disputed, or commercial debts | Small consumer debts |
If standard collection efforts fail or you’re owed a significant amount, hiring a collections lawyer may be your best option.
What Does a Collections Attorney Do?
Here’s a breakdown of the services they typically provide:
Demand Letters
An attorney will first send a legal demand letter requesting payment. These are more impactful than agency notices.
Legal Advice
They’ll advise you on the strength of your case and whether it’s worth pursuing litigation.
Filing Lawsuits
If payment isn’t made, the attorney can file a lawsuit to recover the debt.
Court Judgments
Once the court issues a judgment in your favor, the attorney can enforce collection through:
- Wage garnishment
- Bank levies
- Property liens
Negotiation
A collections attorney may negotiate payment plans, settlements, or confession of judgment agreements with the debtor.
When to Hire a Collections Attorney
You should consider hiring a collections attorney when:
- A large amount of money is at stake (e.g., $5,000+)
- The debt is disputed or denied
- You’ve exhausted standard collection methods
- You need to take legal action to recover the debt
- The debtor has valuable assets that can be pursued through court orders
- Your business deals with repeat late payers
How Much Does a Collections Attorney Cost?
Collections attorneys typically charge in one of three ways:
| Fee Structure | Description |
| Contingency Fee | You pay a percentage (25%–40%) only if they collect successfully |
| Hourly Rate | $150–$400/hour depending on experience and location |
| Flat Fee | Set rate for services like drafting a demand letter or filing paperwork |
Contingency fees are common for undisputed debts, while hourly billing is more typical for complex litigation.
Process of Debt Collection Through an Attorney
Here’s a simplified step-by-step process:
- Consultation – Evaluate the case and discuss legal options
- Demand Letter – Formal request sent to debtor
- Negotiation – Attempt to resolve without court
- Lawsuit Filing – Initiated if no resolution is reached
- Court Hearing – Present evidence; win judgment
- Enforcement – Garnishment, levies, or liens executed
Tips for Working with a Collections Attorney
- Document Everything: Keep signed contracts, emails, payment history, and invoices.
- Act Quickly: Many debts are subject to a statute of limitations, usually 3–6 years depending on your state.
- Be Transparent: Share all facts—both favorable and unfavorable—to help your attorney build a strong case.
- Vet the Lawyer: Choose an attorney with experience in commercial collections or creditor rights law.
Where to Find a Reputable Collections Attorney
Look for attorneys who:
- Specialize in creditor rights or commercial law
- Are licensed in your state or jurisdiction
- Belong to professional groups like the National Association of Retail Collection Attorneys (NARCA)
You can also search:
- Avvo.com – Verified lawyer reviews
- Martindale.com – Peer-rated lawyers
- State Bar websites – For local collections lawyers
Conclusion
If you’re dealing with unpaid debts, uncooperative clients, or high-value defaults, a collections attorney can help you recover your money through legal means. Unlike standard collectors, they offer legal muscle and experience that increases your likelihood of success.
Before proceeding, weigh the costs vs. recovery potential, and consult a qualified collections lawyer to explore your options.
FAQs
1. Can I sue someone for unpaid invoices without a lawyer?
Yes, but using a collections attorney greatly increases your chances of success and ensures proper legal procedure.
2. What happens after winning a judgment?
The attorney will work to enforce the judgment, often by garnishing wages, placing liens, or seizing assets.
3. How long does the debt collection legal process take?
It can range from a few weeks to several months, depending on the court system and whether the debtor disputes the claim.
4. Is hiring a collections attorney worth it for small debts?
Usually no, unless the debtor has multiple accounts or the debt is part of a larger legal strategy.
5. What if the debtor declares bankruptcy?
If bankruptcy is filed, collection efforts are paused. Your attorney can file a claim in bankruptcy court to recover some portion of the debt.
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