Filing a lawsuit can put a strain on your finances. But a lawsuit cash advance can provide a feasible financial lifeline to support your case and your living expenses.
If your personal funds are running low and your case hasn’t gone to court yet, consider a lawsuit advance. It closes the gap from the date of your accident to the settlement date. A lawsuit retainer can provide you with money for the duration of your case.
A demand cash advance is not a loan. The financing company buys a portion of the future settlement proceeds from your lawsuit, depending on the future outcome of the case. Essentially, you receive cash today in exchange for a specified amount of any settlement or judgment received from the litigation. Most of the time, claims funding is used to cover immediate medical and living expenses.
A lawsuit advance is available for all types of cases, including personal injury, medical malpractice, employment discrimination, and wrongful death cases.
Understanding a Lawsuit Cash Advance
Technically, a lawsuit advance is a practice where people who are plaintiffs in lawsuits receive money from a lawsuit loan company that takes a lien on the proceeds of the lawsuit in exchange for cash now. Funding is provided without recourse. This means that you can keep any money you receive, even if the results of the case are negative.
Companies will generally provide a lawsuit advance to people who have a strong case. For them, the cash advance is an investment. If you win, they receive a portion of the monetary award awarded to you by the court. If you lose, they don’t get anything.
Essentially, a lawsuit cash advance poses no risk on your part. You will never have to pay the financing company if your case is unsuccessful in court. But if your case wins, you will probably end up with a lot more money than you would if you settled early. That is even after presenting the financing company with their part of the settlement.
The need for a lawsuit cash advance
Litigation is an expensive process. For most people with personal injury claims, an attorney is hired on a contingency fee basis, which means there are no attorney fees unless the case is successful. Then, any required attorney fees are a percentage of the money recovered. The law firm advances money for the cost of litigation until the case is resolved. (For ethical reasons, lawyers cannot lend their clients money.)
However, for people who pay “out of pocket” legal fees, the need for a lawsuit loan can be critical. Here’s why: People who have been seriously injured in accidents due to the negligence of others can find themselves financially devastated in the process. Many are out of work for weeks or months, leaving them with no income to support their dependents while they recover. Unfortunately, these victims often lack the adequate income or credit history to qualify for a traditional loan. Even if they could, conventional loans require monthly payments that can be an added burden to your situation.
A claim cash advance is a viable option for cash poor claimants. It can help them cover their living expenses, pay for medical care, and cover other personal costs. This can prevent them from complaining about having to sell their valuables or borrow money from family and friends to keep their lives on track.
A lawsuit advance allows people to seek justice without having to put their lives on hold by sacrificing other necessary financial responsibilities. Instead of worrying about finances, they can focus on recovering from their injuries while awaiting a trial verdict or settlement.
Work with a financing company
There is a growing number of companies that offer a cash advance on demand. Seeking financing from these sources is fairly straightforward. Simply contact the provider for a free consultation. The company will follow up with your attorney, evaluate your case material, and frequently let you know within 48 hours if you are eligible for lawsuit funding. Generally, no application fee, credit check, or employment verification is required.
If you are approved for a lawsuit cash advance, your attorneys will retain full control over your case. The funder will not become involved with your case strategy or receive payment until the case is resolved.
When choosing a financing company, ask questions about the practices, fees, and terms involved.
The American Litigation Finance Association (ALFA) offers some helpful tips to help you locate a suitable lawsuit cash advance company:
– Dealing with a company that is investing for its own portfolio. Otherwise, you could end up paying much more than necessary.
– Do not provide information that cannot be discovered otherwise. Inside information should only be shared with your attorney, not a third party.
– Do not make multiple requests with different financiers. You have no way of knowing if that company will try to sell your deal to one of the others you’ve applied to (which won’t mesh very well with the actual funding source). Additionally, multiple requests create a hassle for your attorney, as many requests for information will have to be completed. His best approach is to make an informed choice and work with that company.
– Consult with your lawyer. Never sign a complex contract, such as a lawsuit cash advance agreement, without first consulting with your attorney.