Lawyer Payment Plans: How and Why to Implement Them In Your Firm

Offering lawyer payment plan options as part of your practice can benefit your client and law firm. Here are a few benefits you may see by implementing these plans.

• Helps attract more clients: Standard attorney fees can be too expensive for some people to afford. By offering attorney payment plans, you’ll make your services more accessible to a broader client base by giving clients the option to break your lawyer fees into smaller installments.
• Creates steadier revenue: When you use payment plans, you’ll receive payments over time, creating more predictable and frequent revenue.
• Improves reputation: Attorney payment plans can help elevate the client experience by giving your clients different payment options so they can choose what works for their finances. This may lead to better online reviews and more referrals.

Legal Fee Financing vs. Payment Plans

Offering different payment options to your clients can have a huge impact on your practice and improve the client experience. However, some law firms choose to incorporate legal fee financing alongside payment plans to further expand their clients’ options.

Though both allow clients to make payments over time rather than upfront, they work in different ways.

• Legal fee financing: This alternative payment method works similarly to short-term loans. Clients make payments over time to a third-party loan provider and are typically charged interest on the amount they owe in exchange for the ability to pay in installments. Since clients owe the loan provider, firms often recieve full payment upfront.
• Legal fee payment plans: These payment plans are negotiated between the client and the law firm directly. In most cases, payment plans offer a better client experience because these plans pose less risk for your clients’ credit scores.

How to Implement a Payment Plan

Implementing these plans can seem daunting at first, but they only take a few key steps. Here’s what the process will look like for most practices:

1. Understand what you want your payment plans to accomplish. Many attorneys implement these plans to make their services easier to afford for a broader client base. By identifying your ‘why,’ you’ll better structure the plans and your billing statements to fit your goals.
2. Develop a payment schedule. Before you launch your payment plans, you’ll want to create your payment schedule. Decide how often you want your clients to make payments. Some firms prefer weekly or bi-weekly payments, while others prefer monthly payments. Every payment plan should specify the total amount due as well as the amount due during each payment period.
3. Know what forms of payment to accept. Many lawyers that use payment plans also accept various payment types to make their client’s lives easier. For example, you may choose to accept credit cards, debit cards, and eChecks to accommodate your clients’ needs more effectively.
4. Determine what happens with late payments. Consider how you want to handle late payments and at what point you’ll consider late payments subject to any penalties. Some firms charge interest on late payments, while others charge flat fees for each late payment.
5. Write your payment plan agreement. Though every case may differ, your repayment plans should follow the same structure. This will simplify your accounting efforts and help your support staff follow up with any clients who fall behind. Create a clear payment plan agreement that you can use for each client.
6. Don’t hesitate to check in. Though your clients are ultimately responsible for making payments on time, it’s in your best interest to follow up with them throughout the repayment period. Give them updates on their case and let them know that payments are due on specific dates. This shows them that you’re still involved and actively working on their behalf.

With clear processes in place, you’ll be better able to collect payments on time and continue adding to your law firm’s revenue.