The big challenge in collecting fees in matrimonial cases is to push yourself and your firm ahead of the Bloomingdale's bill. Lawyers representing clients in other areas have similar concerns about making the payment of the lawyers a priority. Bloomingdale's charges 1 percent per month on outstanding and overdue balances. Banking institutions, including Visa, charge even more. A client who perceives himself tight for funds will happily defer payment owed to a lawyer if other creditors are charging interest and the lawyer is not.
Lawyers who have these concerns frequently contract with their clients to charge interest on their overdue invoices to discourage clients from deferring payment. This interest is designed more to discourage the client from postponing payment than as additional income for the lawyer. Since these interest penalties are designed to put payment of legal bills in parity with the rest of a client's bills, rates need to at least approach the rates non-lawyers apply to their past due balances. Many New York lawyers charge a 1 percent monthly late fee.
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