How long can a lawyer hold your settlement check? A comprehensive guide 2024

How long can a lawyer hold your settlement check?

A settlement check is a financial payment issued by the responsible party to resolve a legal dispute without going to court. It’s a lump sum amount agreed upon by both parties to compensate for damages or injuries sustained.

Why Might a Lawyer Hold Your Settlement Check?

Even after reaching a settlement agreement, you might not receive your check immediately. 

Your lawyer may hold your settlement check for several reasons, including:

Check Clearance

Banks need time, typically 5-7 days, to clear checks before funds become available.

Resolving Liens and Subrogation Claims

Before you receive your money, your lawyer must resolve any outstanding liens and subrogation claims.

  • Liens: These are legal claims against your settlement, such as unpaid medical bills or outstanding debts. Your lawyer must contact the lienholders, negotiate settlements, and ensure they are paid before disbursing your share.
  • Subrogation: This is when an insurance company that paid your medical expenses seeks reimbursement from your settlement. Your lawyer will work with the insurance company to determine the amount they are entitled to receive.

The Disbursement Process

Disbursing your settlement involves paying all parties involved, including:

  • Yourself
  • Your lawyer (legal fees)
  • Medical providers
  • Other lawyers involved in the case

This process requires meticulous attention to detail to ensure everyone receives the correct amount.

Calculating Attorney Fees

Your lawyer’s fees are typically a percentage of your total settlement amount. 

They will deduct their fees before disbursing your share.

Further Legal Action

In some cases, even after reaching a settlement, additional legal actions may be necessary. 

Your lawyer may hold your check until these issues are resolved.

Client Communication Issues

Clear communication with your lawyer is crucial throughout the process. 

Delays can occur if your lawyer lacks the necessary information or responses from you.

Key Terminology

Escrow Account: This is a secure account held by a neutral third party where your settlement funds are deposited until they are ready to be disbursed.

Disbursement: This is the process of distributing the settlement funds to all parties involved.

Legal Fees: This is the amount your lawyer charges for their services in handling your case.

Medical Liens: These are legal claims against your settlement by medical providers who treated your injuries.

Subrogation: This is when an insurance company that paid your medical expenses seeks reimbursement from your settlement.

By understanding these key terms and why your lawyer might hold your settlement check, you can better navigate the process and receive your funds more efficiently.

Why Your Lawyer May Hold Your Settlement Check?

How long can a lawyer hold your settlement check

Check Clearance

Even though you might feel entitled to your settlement funds immediately after reaching an agreement, there’s a crucial step that must transpire before you can access them: check clearance.

This process ensures the validity of the check and guarantees the availability of funds before disbursement.

Banks typically require 5-7 business days to clear checks, meaning the funds won’t be accessible until then.

During this period, your lawyer will hold onto your settlement check, ensuring its security and preventing any unauthorized access.

While this might seem like a delay, it plays a vital role in safeguarding your financial interests.

While waiting for the check to clear, you can use this time to gather necessary paperwork, such as tax forms or identification documents, which might be required for disbursement.

Open and consistent communication with your lawyer is crucial during this period.

They can provide you with updates on the clearance process and answer any questions you might have.

Once the check clears, your lawyer can proceed with the next steps in the disbursement process, which might include resolving liens and subrogation claims, calculating legal fees, and preparing the final distribution.

Resolving Liens and Subrogation Claims

Before you receive your hard-earned settlement, your lawyer must address any existing liens and subrogation claims attached to it.

These legal claims represent outstanding debts or reimbursements due to various parties, and they must be settled before you can access your full compensation.

What are Liens and Subrogation?

Liens: These are legal claims against your settlement that grant specific parties the right to receive a portion of the funds.

Common examples of liens include:

  • Medical liens: These are claims filed by medical providers who treated your injuries and are entitled to reimbursement from your settlement.
  • Government liens: These are claims filed by government agencies for unpaid taxes, benefits received, or other financial obligations.
  • Attorney liens: These are claims filed by your attorney for unpaid legal fees associated with your case.

Subrogation: This is when an insurance company that paid your medical expenses seeks reimbursement from your settlement.

They essentially step into your shoes and claim the right to the portion of your settlement that covers their previous payments.

Common Examples of Liens

Medical liens are the most common type of lien encountered in personal injury cases.

They cover a wide range of medical expenses, including:

  • Hospital bills
  • Doctor’s fees
  • Medication costs
  • Physical therapy sessions
  • Rehabilitation services

Other examples of liens you might encounter include:

  • Mechanic’s liens: If your injuries resulted from a car accident, the mechanic who repaired your vehicle might file a lien against your settlement to recoup their repair costs.
  • Property damage liens: If your injuries caused damage to property, the owner of the damaged property might file a lien against your settlement to seek compensation.
  • Loan liens: If you took out a loan to cover your legal fees or living expenses during your case, the lender might file a lien against your settlement to ensure repayment.

Addressing Other Liens and Claims

Your lawyer plays a crucial role in identifying, negotiating, and resolving any liens and subrogation claims attached to your settlement. They will:

  • Review your case file: Identify all potential liens and subrogation claims.
  • Contact lienholders: Communicate with each lienholder to verify the amount of their claim and negotiate settlements.
  • Obtain necessary documentation: Gather evidence to support or dispute the validity of each lien or claim.
  • Negotiate payment plans: Work with lienholders to establish payment plans if you are unable to pay the full amount upfront.
  • Present arguments to court: In some cases, your lawyer might need to present arguments to court to have a lien or claim removed.

By actively addressing these issues, your lawyer ensures you receive your fair share of the settlement and prevents complications in the disbursement process. 

The Disbursement Process

Once the check clears and any outstanding liens or subrogation claims are resolved, your lawyer can begin the disbursement process, where your settlement funds are distributed to all parties involved.

This process requires meticulous attention to detail and careful coordination to ensure everyone receives the correct amount promptly.

Paying All Parties Involved

During the disbursement process, your lawyer will be responsible for distributing funds to the following parties:

  • Yourself: You will receive the remaining portion of the settlement after all fees, liens, and other obligations have been deducted.
  • Your lawyer: Your lawyer will deduct their legal fees, which are typically a percentage of the total settlement amount.
  • Medical providers: Any medical providers who treated your injuries and have valid liens will receive payment from your settlement.
  • Other lawyers involved in the case: If other lawyers were involved in your case, your lawyer will distribute their portion of the fees.
  • Government agencies with liens: If any government agencies have liens against your settlement, they will receive their respective payments.

Ensuring Accurate and Timely Payments

Accurately and promptly distributing funds to all parties involved is crucial to ensuring a smooth and successful disbursement process.

Your lawyer will utilize various methods to achieve this, including:

  • Detailed records: Meticulously maintaining records of all financial transactions, including invoices, receipts, and payment confirmations.
  • Secure payment methods: Utilizing secure payment methods, such as wire transfers or checks, to ensure the safe and reliable transfer of funds.
  • Clear communication: Maintaining clear communication with all parties involved throughout the process, providing updates and addressing any questions or concerns promptly.

Role of Escrow Accounts

In some cases, your lawyer might utilize an escrow account to hold your settlement funds during the disbursement process.

This secure account, managed by a neutral third party, offers several benefits:

  • Enhanced protection: The escrow account safeguards your funds against potential misappropriation or loss.
  • Dispute resolution: If disputes arise regarding the distribution of funds, the escrow agent can act as a neutral party to facilitate resolution.
  • Improved transparency: The escrow account provides a clear record of all financial transactions, ensuring transparency and accountability for all parties involved.

By utilizing an escrow account, your lawyer can ensure the safe and efficient disbursement of your settlement funds while protecting your financial interests.

Calculating Attorney Fees

An important aspect of the settlement disbursement process involves calculating and finalizing your lawyer’s fees.

This ensures that your lawyer receives fair compensation for their services while maximizing your own financial recovery.

How are Attorney Fees Calculated?

Several methods are used to calculate attorney fees in settlement cases, with the most common being:

  • Contingency fee: This is a percentage-based fee typically ranging from 33% to 40% of the total settlement amount. The lawyer only receives payment if they win your case.
  • Hourly rate: In some cases, lawyers may charge an hourly rate for their services, often combined with a smaller success bonus. This method is typically used for complex cases requiring significant time and resources.
  • Lodestar method: This involves multiplying the lawyer’s reasonable hourly rate by the number of hours spent working on your case. This method is less common than the contingency fee arrangement.

The specific method used to calculate your attorney fees will depend on factors such as the complexity of your case, the amount of time and effort required, and the agreement you reached with your lawyer.

Finalizing Fees and Deductions

Once your attorney fees have been calculated, your lawyer will deduct them from your settlement amount before disbursing the remaining funds to you.

It’s important to ensure transparency and understanding throughout this process.

Here’s what you can expect:

  • Reviewing fee agreements: Carefully review your fee agreement with your lawyer to understand the specific terms and how your fees will be calculated.
  • Receiving detailed invoices: Your lawyer should provide you with a detailed invoice outlining the hours worked, hourly rate, and any other applicable charges.
  • Asking questions and seeking clarification: If you have any questions or concerns about the fees, don’t hesitate to ask your lawyer for clarification.

By ensuring transparency and open communication, you can finalize your attorney fees and proceed with the disbursement process with confidence. 

Remember, understanding your fee agreement and having clear expectations is crucial for a smooth and satisfactory settlement experience.

Further Legal Action

How long can a lawyer hold your settlement check

Even though a settlement agreement might have been reached, there are situations where further legal action might be necessary.

This can happen for various reasons, and it’s important to understand how it can affect the disbursement of your settlement funds.

Scenarios for Further Legal Action:

  • Appeals: The opposing party might appeal the settlement agreement, challenging its terms or validity. This can lead to further legal proceedings that might delay or modify your settlement.
  • Compliance issues: If the other party fails to comply with the terms of the settlement agreement, your lawyer might need to take legal action to enforce compliance. This can involve additional court appearances and hearings.
  • New evidence emerges: If new evidence comes to light that significantly alters the case, further legal action might be necessary to adjust the settlement or pursue additional compensation.
  • Discovery of undisclosed information: If it’s discovered that the other party withheld crucial information during the settlement negotiations, this can be grounds for further legal action and potentially voiding the agreement.

Impact on Disbursement:

If further legal action becomes necessary, it can affect the disbursement of your settlement funds in several ways:

  • Delayed access to funds: The legal proceedings might take time to resolve, potentially delaying your access to the full amount of your settlement.
  • Additional legal fees: If your lawyer needs to take further legal action, you might be responsible for additional legal fees.
  • Modified settlement amount: Depending on the outcome of the legal proceedings, the original settlement amount might be modified, impacting the amount you ultimately receive.

Staying Informed:

It’s crucial to maintain open and regular communication with your lawyer throughout the process.

They will keep you informed about any potential for further legal action and its implications for your settlement.

They can also answer your questions and address any concerns you may have.

Client Communication Issues

Clear and consistent communication between you and your lawyer is vital throughout the settlement process, especially when it comes to disbursement.

Delays and complications can arise due to communication issues, potentially impacting the speed and efficiency of receiving your funds.

Here’s how communication issues can affect disbursement:

  • Delayed responses: Failing to respond promptly to your lawyer’s requests for information, documentation, or confirmation can delay the disbursement process.
  • Incomplete information: Providing inaccurate or incomplete information can lead to errors in calculations, lien resolution, and payment distribution.
  • Misunderstandings: Lack of clarity or misinterpreting information can lead to confusion and delays in resolving necessary steps.
  • Lack of transparency: Withholding information or not asking questions can create a barrier between you and your lawyer, hindering efficient progress.

To avoid communication issues:

  • Respond promptly: Respond to your lawyer’s emails, phone calls, and requests for information promptly to keep the process moving forward.
  • Provide accurate information: Double-check information before submitting it to your lawyer to ensure accuracy and avoid errors.
  • Ask questions: Don’t hesitate to ask questions if you have any doubts or need clarification about any aspect of the process.
  • Be transparent: Inform your lawyer of any relevant changes or updates that might affect your situation or the settlement.
  • Maintain regular contact: Schedule regular meetings or calls with your lawyer to discuss the progress and address any concerns.

Factors Impacting Settlement Check Delay

Several factors can influence the speed at which you receive your settlement check after reaching an agreement.

Understanding these factors can help you manage expectations and better navigate the disbursement process.

Complexity of the Case

The complexity of your legal case can significantly impact the timeframe for receiving your settlement check.

A case with more complexity often requires a longer time to resolve and resolve various issues before disbursement.

Multiple Parties and Claims

  • Multiple parties: When numerous parties are involved in the case, coordinating communication, reaching agreements, and resolving disputes can take longer.
  • Multiple claims: If your case involves multiple claims, such as personal injury and property damage, each claim may require separate investigations, negotiations, and documentation, further extending the process.

Negotiations, Investigations, and Court Proceedings

  • Negotiations: Complex cases often involve lengthy negotiations with multiple parties. Reaching a mutually agreeable settlement can take time and effort, delaying the disbursement.
  • Investigations: Thorough investigations might be required to gather evidence, verify information, and build a strong case. This can extend the timeline significantly.
  • Court proceedings: If your case goes to court, you can expect further delays due to the legal proceedings, such as hearings, depositions, and trials.


  • A car accident case involving multiple injured parties and disputed claims will likely take longer to settle than a straightforward single-party case.
  • A medical malpractice case requiring extensive medical records review and expert consultations will likely take longer to resolve than a case with readily available evidence.

Number of Liens and Claims

The number of liens and claims attached to your settlement can significantly impact the disbursement timeline.

Each lien or claim requires attention, negotiation, and resolution before you receive your funds.

Negotiating with Lienholders

  • Each lienholder has specific requirements and needs to be negotiated with individually.
    • This can be a time-consuming process, especially if multiple lienholders are involved.
  • Negotiations might involve discussing the validity of the lien, negotiating the amount owed, and establishing a payment plan.
  • Communication with lienholders is crucial to ensuring their claims are settled efficiently and do not delay your settlement disbursement.

Obtaining Necessary Documentation:

  • Resolving liens and claims often requires obtaining specific documentation from various parties, such as medical providers, insurance companies, or government agencies.
  • Gathering this documentation can take time, especially if the information is incomplete or requires additional verification.
  • Incomplete documentation can stall the process and delay the disbursement of your settlement funds.


  • A case with several outstanding medical liens will likely take longer to resolve compared to a case with no liens.
  • If your settlement is subject to a government lien for unpaid taxes, obtaining the necessary clearance from the government agency might take additional time.

Availability of Funds:

The financial situation of the party responsible for paying your settlement can also impact the disbursement timeline.

Financial Problems of the Settling Party

  • If the settling party experiences financial difficulties, they might struggle to pay the full settlement amount immediately.
  • This could lead to delays in disbursement or require negotiations for alternative payment arrangements.
  • In extreme cases, the settling party’s insolvency might jeopardize your ability to receive the full settlement amount.

Bankruptcy Proceedings

  • If the settling party files for bankruptcy, your settlement claim becomes part of the bankruptcy proceedings.
  • This can significantly delay receiving your funds as the bankruptcy court oversees the distribution of assets to creditors.
  • You might need to participate in the bankruptcy proceedings to protect your claim and maximize your recovery.

Getting Your Settlement Check Faster

How long can a lawyer hold your settlement check

While waiting for your settlement check can be challenging, there are proactive steps you can take to expedite the process:

Stay Informed

Open communication with your lawyer throughout the process is key.

Regularly inquire about the progress, ask clarifying questions, and express any concerns you have.

This proactive approach helps ensure you understand each step and identify potential delays early on.

Actively participate: Attend scheduled meetings, respond promptly to inquiries, and provide requested information quickly. Your timely engagement keeps the process moving forward efficiently.

Provide Necessary Information Promptly

Your lawyer needs accurate and complete information to resolve liens, negotiate claims, and calculate fees. Responding promptly to requests for documentation, medical records, and financial information can significantly shorten the timeline.

Be proactive: Gather and organize relevant documents in advance to expedite the process. This includes medical bills, insurance statements, and receipts.

Negotiate with Lienholders

If your settlement is subject to liens, consider collaborating with your lawyer to negotiate directly with lienholders. Reaching mutually agreeable settlements on payment plans or reduced amounts can significantly expedite the disbursement process.

Be prepared: Research lienholder policies and potential negotiation strategies beforehand to strengthen your position.

Explore Alternative Funding Options

While waiting for your settlement, explore alternative funding options to bridge the financial gap. These options include:

Lawsuit Loans

These are non-recourse loans based on the anticipated value of your settlement.

You receive the funds upfront in exchange for a higher repayment amount upon receiving your settlement.


Some lawyers offer advances against your legal fees, providing you with immediate access to some funds while waiting for your settlement.

Ethical Considerations

Carefully research and compare different funding options.

Ensure the terms are transparent and ethical, avoiding predatory practices with exorbitant interest rates or hidden fees.

Inform your lawyer about any funding arrangements to maintain transparency and avoid potential conflicts of interest.


  • Carefully evaluate the terms and conditions of any loan agreement before accepting.
  • Prioritize clear communication with your lawyer about your chosen funding option.
  • Ensure the financing option aligns with your ethical values and financial situation.

By taking the initiative and exploring different avenues, you can potentially accelerate receiving your settlement funds and alleviate financial pressure while waiting for the final disbursement.


Key Takeaways

Navigating the process of receiving your settlement check can feel complex, but understanding the key factors involved can significantly ease your experience.

How long can a lawyer hold your settlement check

Here are the key takeaways:

  • Delays are common and influenced by various factors, including check clearance, resolving liens and claims, calculating legal fees, and potential further legal action.
  • Clear and consistent communication with your lawyer is vital to ensuring a smooth and efficient process.
  • Your proactive participation in providing information promptly and staying informed can expedite the disbursement timeline.
  • Exploring alternative funding options can offer temporary financial relief while awaiting your settlement.

Importance of Understanding the Process

Understanding the intricacies of the settlement disbursement process empowers you to make informed decisions and navigate potential delays effectively.

  • Managing expectations: By being aware of the different stages and potential delays, you can better manage your expectations and avoid unnecessary anxiety.
  • Asking informed questions: Knowing the key terminology and steps involved allows you to ask informed questions of your lawyer and ensure you fully understand the process.
  • Making informed decisions: Grasping the factors influencing the timeline and your options for expediting the process empowers you to make informed decisions that best suit your circumstances.

Active Participation and Communication

Your active participation and open communication with your lawyer are crucial for a successful and timely settlement disbursement.

  • Respond promptly: Timely responses to requests for information, confirmation, and clarifications keep the process moving forward.
  • Ask questions: Don’t hesitate to ask questions if you have any doubts or need clarification regarding any aspect of the process.
  • Express concerns: Communicate any concerns you have about potential delays or challenges to ensure your lawyer can address them promptly.
  • Stay informed: Regularly inquire about the progress and express your interest in staying updated on developments.

FAQ: How long can a lawyer hold your settlement check?

  1. How long does it take to receive a settlement check after settling a case?

The timeframe varies depending on the complexity of the case and external factors. Typically, it takes 3 to 6 weeks after signing the settlement agreement.

  1. What are some reasons my settlement check might be delayed?

Possible reasons for delays include:

  • Check clearance: Banks need time (5-7 days) to process the check.
  • Resolving liens and subrogation claims: These legal claims need to be settled before you receive your funds.
  • Calculating attorney fees: Your lawyer needs to deduct their fees before disbursing your share.
  • Further legal action: Unforeseen legal issues might arise, requiring additional time to resolve.
  1. What is an escrow account and how does it affect my settlement?

An escrow account is a secure account held by a neutral third party where your settlement funds are deposited until they are ready to be disbursed. This ensures the funds are safe and available when the disbursement process is complete.

  1. What are common types of liens that can affect my settlement?
  • Medical liens: Hospitals and doctors who treated your injuries can claim a portion of your settlement to cover their bills.
  • Government liens: Unpaid taxes, benefits received, or other financial obligations to government agencies can lead to liens.
  • Attorney liens: Your lawyer can file a lien for unpaid legal fees associated with your case.
  1. How can I negotiate with lienholders to expedite the settlement process?
  • Gather documentation: Organize medical bills, insurance statements, and any relevant paperwork.
  • Research lienholder policies: Understand their typical negotiation strategies and potential payment plans.
  • Collaborate with your lawyer: Work together to negotiate reduced amounts or favorable payment terms.
  1. What are lawsuit loans and how can they help me while waiting for my settlement?

Lawsuit loans provide immediate access to funds based on the anticipated value of your settlement. You repay the loan with interest upon receiving your settlement.

  1. What are the ethical considerations when considering alternative funding options like lawsuit loans?
  • Beware of predatory lenders: Compare interest rates and terms to avoid hidden fees or exorbitant charges.
  • Ensure transparency: Inform your lawyer about any funding arrangements to avoid conflicts of interest.
  • Choose ethical options: Prioritize lenders with transparent practices and fair terms.
  1. How can I stay informed about the progress of my settlement and potential delays?
  • Maintain regular communication with your lawyer: Ask questions, express concerns, and stay updated on developments.
  • Review documents and invoices: Understand how fees are calculated and how liens are being addressed.
  • Attend scheduled meetings: Actively participate in discussions and provide necessary information promptly.
  1. What should I do if I feel my lawyer is not communicating effectively or addressing my concerns?
  • Schedule a meeting: Express your concerns directly and seek clarification on any issues you have.
  • Consider mediation: If communication remains strained, explore mediation with a neutral third party to facilitate a solution.
  • Seek legal counsel: If you suspect unethical practices or inadequate representation, consult with another lawyer for advice.
  1. What resources can I access for further information about settlement checks and the disbursement process?
  • American Bar Association: Offers resources and guides on legal matters, including personal injury and settlement procedures.
  • National Association of Consumer Advocates: Provides consumer protection information and advocacy services.
  • Your state’s bar association: Offers specific resources and guidance relevant to your state’s legal system.
  1. What are some tips for managing financial pressure while waiting for my settlement check?
  • Create a budget: Track your income and expenses to manage your finances effectively.
  • Prioritize essential needs: Focus on meeting your basic living expenses first.
  • Explore alternative sources of income: Consider temporary work or freelance opportunities to supplement your income.
  • Communicate with creditors: Explain your situation and seek flexible payment arrangements if needed.
  1. How can I protect myself from potential scams related to settlement checks?
  • Be cautious of unsolicited offers: Do not respond to emails, calls, or letters from unknown individuals offering assistance with your settlement.
  • Verify information: Always confirm details with your lawyer and official sources before taking any action.
  • Never share personal information: Avoid disclosing financial details or sensitive information with anyone you do not trust implicitly.

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