Pursuing 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 living expenses.
If your personal funds are running out, and your case still hasn’t made it to court, consider a lawsuit advance. It bridges the gap from your accident date to the settlement date. A lawsuit advance can provide you with money for the duration of your case.
A lawsuit cash advance is not a loan. The funding company buys a piece of the future settlement proceeds of your lawsuit, contingent upon the future outcome of the case. Essentially, you receive cash today in exchange for a specific amount of any settlement or judgment received from the litigation. Most often, lawsuit funding is used to cover medical and immediate 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 in which individuals who are plaintiffs in lawsuits receive money from a lawsuit loan company who takes a lien on the proceeds of the suit in return for cash now. Funding is provided on a non-recourse basis. This means any money you receive is yours to keep even if the results of the case have a negative outcome.
Companies generally will provide a lawsuit advance to individuals who have a strong case. For them, the cash advance is an investment. If you win, they receive a portion of the monetary award granted to you by the court. If you lose, they get nothing. collection laws in California
In essence, a lawsuit cash advance poses no risk on your part. You never have to repay the funding company if your case is unsuccessful in court. But if your case wins, you’ll probably end up with significantly more money than you would have if you settled early. That’s even after you present the funding company with its portion of the settlement.
The Need for a Lawsuit Cash Advance
Litigation is an expensive process. For most people with personal injury claims, a lawyer is hired on a contingent fee basis, meaning there is no attorney fee unless the case is successful. Then, any attorney fee that’s required is 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 money to their clients.)
However, for individuals paying legal fees “out of pocket”, the need for a lawsuit loan can be critical. Here’s why: People who have been severely injured in accidents due to the negligence of others can be financially devastated during the process. Many are put out of work for weeks or months, leaving them with no income to provide for their dependents while they recover. Unfortunately, these victims often lack the proper income or credit history to qualify for a traditional loan. Even if they could, conventional loans require monthly payments which can be a further burden to their situation.