Legal funding is a vital resource for plaintiffs who need financial support during the often lengthy litigation process. By providing a cash advance based on the potential outcome of a case, legal funding allows individuals to meet their financial needs while pursuing justice. This guide offers a comprehensive understanding of how legal funding works, from application to repayment, highlighting its benefits and importance in the legal landscape.
What is Legal Funding?
Legal funding is a non-recourse cash advance provided to plaintiffs involved in a lawsuit. Non-recourse means that if the plaintiff loses the case, they are not required to repay the advance. This type of funding is typically used in personal injury cases, medical malpractice claims, and other types of lawsuits where the plaintiff is seeking monetary compensation.
The Legal Funding Process
Application
Initial Contact. The process begins when a plaintiff contacts a legal funding company to apply for funding. This can often be done online or over the phone.
Information Gathering. The plaintiff provides details about their case, including the type of lawsuit, the stage of litigation, and their attorney’s contact information.
Case Evaluation
Attorney Collaboration. The legal funding company collaborates with the plaintiff’s attorney to gather necessary documents and information. This includes case details, potential settlement amounts, and evidence supporting the claim.
Risk Assessment. The funding company evaluates the case’s merits, the likelihood of winning, and the estimated settlement or award amount. This assessment helps determine the amount of funding that can be offered.
Funding Offer
Approval. If the case is deemed strong, the funding company will approve the application and make a funding offer. This offer outlines the amount of the cash advance, fees, and repayment terms.
Agreement. The plaintiff reviews and signs a funding agreement. This contract details the amount provided, any associated fees, and the repayment terms if the case is successful.
Disbursement of Funds
Receiving Funds. Once the agreement is signed, the funds are disbursed to the plaintiff. This process can be relatively quick, often within 24 to 48 hours.
Use of Funds. Plaintiffs can use the money to cover living expenses, medical bills, legal fees, or any other costs that have arisen due to the ongoing litigation.
Repayment of Legal Funding
Case Resolution
Settlement or Verdict. Repayment occurs only if the plaintiff wins the case or reaches a settlement. The legal funding company receives a portion of the settlement or award as repayment.
No Win, No Pay. If the plaintiff loses the case, they owe nothing to the legal funding company. This non-recourse nature makes legal funding a low-risk option for plaintiffs.
Repayment Terms
Fees and Interest. Legal funding companies typically charge fees or interest on the cash advance. These charges are outlined in the funding agreement and are based on the amount advanced and the time taken to resolve the case.
Repayment Amount. The total repayment amount includes the principal (the cash advance) plus any accrued fees or interest. This amount is deducted from the settlement or award before the plaintiff receives their portion.
Legal Funding From Cash Now Funding Group
Are you or a family member in need of financial assistance due to a lengthy legal battle? Are you preparing for a long-term legal battle to get the compensation you deserve? Cash Now Funding Group can be the financial lifeline you need while your case settles. Applying is free and confidential & no credit check is required.
