What contract review actually costs

Contract work is priced in one of two ways. Either you buy time, at $200 to $500 an hour for a business attorney, or you buy an outcome, at a flat fee quoted per document. Neither is inherently better value. Which one wins depends almost entirely on how much negotiation the contract attracts, and that is the thing you cannot know in advance.

The market bands

Simple contract review is commonly quoted at $300 to $1,000 as a flat fee. Drafting from scratch runs $500 to $3,000, with complexity doing most of the work in that range. Hourly rates for general business attorneys sit at $200 to $500, with large city firms and specialists above that and rural solo practitioners sometimes below it.

Those bands hold across most of the country. What changes is how many hours the document actually takes.

Document type drives the hours

A nondisclosure agreement is short, heavily standardised and usually reviewable in under two hours. A service agreement with scope, payment terms, liability caps and termination rights takes longer, typically one and a half to four hours to review properly. Employment contracts add state specific complications around restrictive covenants and worker classification. Commercial leases are the outlier: long, drafted to favour the landlord, and rarely reviewable in less than three hours if the review is worth having.

Complexity is not the same as length

A twenty page contract with standard terms can be quicker than a five page agreement with an unusual revenue share. What raises cost is unfamiliar structure, multiple parties, cross border elements, regulated activity and high value at stake. Any of those can push a routine review into a bespoke drafting exercise.

Negotiation rounds are the hidden variable

Almost every flat fee quote includes one round of revisions. If the other side sends back redlines twice more, you either pay separately for each round or find yourself moved onto hourly billing. Each round realistically adds half an hour to an hour and a half of professional time. On a contract with a determined counterparty, negotiation can cost more than the original review.

When hourly wins and when flat fee wins

Flat fees are worth paying when you cannot absorb an open ended bill and when the scope is genuinely well defined. They cap your downside, and the provider prices in the risk of things going long. Hourly is better when the work is likely to be quick and you trust the estimate, because you are not paying for risk that never materialises.

The practical test: if you would be upset by a bill twice the size of the estimate, buy a flat fee. If you would shrug, hourly will usually cost less.

Cheaper options that are sometimes appropriate

Template libraries and subscription legal services sit below both models. For a standard mutual nondisclosure agreement with a counterparty of similar size, a good template is often adequate. For anything where the downside of a bad clause exceeds a few thousand dollars, the maths favours paying a professional.

Questions that change the quote

Ask whether the fee includes redlines and how many rounds. Ask the minimum billing increment, since six minute increments and fifteen minute increments produce very different bills for short emails. Ask who does the work. Ask whether you receive a reusable template you can run yourself next time, because that turns a one off cost into an asset.

Compare both models for your document in the contract review and drafting cost calculator.