Everything to Know about Litigation Financing.
When you are involved in a lawsuit, you can only hope that the evidence presented sways the decision to be made in your favor. When you talk of litigation funding , it is a practice where a third party that is not involved in a case provides funding to the plaintiff involved in the lawsuit. Gaining lawsuit financing depends only on the merit of the case that you are involved in , this is because the person financing the lawsuit needs to be guaranteed of getting back his money with the settlement.
Its important for the company to look in to the lawsuit itself when financing the case because the money is not a loan. It is better to look at a lawsuit financing as an assignment of the portion of the client in an event that they win the case that is at hand. If it so happens that the case is lost , the money used to fund the lawsuit goes down with the case as there is no reparation money. When it comes to a case being financed, some may question on the ethical nature of a lawyer referring a client to a lawsuit financing party.
Yes it is ethical if a lawyer refers a client to a lawsuit financing company provided they have no interest in the financing company. It has to be established also that the attorney handling the case will not in any way profit from the transaction. There will be a conflict of interest if the lawsuit company is involved in the lawsuit so the company that has been approached by the client should not be involved in any way. When the lawyer refers the client to the financing company , there are benefits for all the parties involved , some too obvious. If a client gets to secure financing from a source that they had not anticipated , it will definitely ease the burden. Lawsuit companies come in handy especially if the client has no way to raise the money needed to finance the lawsuit that they are involved in . Pre settlement advance qualification requires you to undergo a process but it’s actually very simple. Litigation companies will require you to fill some application to help them evaluate the case at hand.
The merits of the litigation case are assessed and if the parties representing the company have questions the attorney is called upon to provide answers. The decision on whether the case will receive some funding is made within 24 to 48 hours of receiving the documents of the case. If the case is accepted, the attorney will receive a contract outlining some details on rates and transactions charged and on how they will receive the money from the client. Some cases of the litigation cases may be settled already but approach litigation companies for financing . Medicare solutions, distribution protocols or court order approval among other reasons may occasion the need for post settlement advances.