Lawsuit / Pre-Settlement Legal Advances (also known as litigation financing) is the process through which plaintiffs (including law firms) can finance their costs of litigation and other expenses through a third party funding company. Such third party funding companies provide non-recourse cash advances in exchange for a percentage share of the lawsuit’s settlement. In the event that the plaintiff loses the case, the non-recourse nature of the transactions means the advance does not have to be paid back by the injured party.
Lawsuit Advances can help avoid all types of financial disaster during the course of a drawn out lawsuit. The money is typically used not just to pay for litigation, but also for personal financial obligations of the plaintiff. Such cash can be used to avert foreclosure, as living and retraining expenses as a result of a job loss, for emergency medical procedures, or almost any other reason. Recent statistics provided from one of the larger financing firms within the industry state that over 62% of funds provided to plaintiffs are used to stop a home foreclosure.
Lawsuit Advances allow plaintiffs to “stick it out”. Prior to Lawsuit Advances, many litigants were forced to settle their legal cases early and for lesser amounts than they should just to get some cash to avoid financial troubles.
To qualify for a legal advance, the merits of the case must also be strong and solid and the plaintiff himself / herself must not be at fault. Additionally, the defendant in the case must be of such size that they have the ability to pay the award, such as a large corporation or insurance company. The injured party’s attorney must also agree to the legal financing and generally has to sign an agreement allowing for the legal financing to occur.
Marketing for Pre-Settlement Legal Advances
This is obviously an area where networking with personal injury lawyers can pay dividends and in today’s litigious world, there is no shortage of such attorneys. It is also an area where small classified ads can pay off.
Advertise this service in the “Money to Lend” areas of local classifieds under “Legal Cost Funding” or a similar heading.
Tomorrow’s Important Lesson
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