Legal funding, mostly known as litigation funding is also known in some places as litigation financing. It is a mechanism whereby law firms or even individuals fund their legal costs by the assistance of a third party company. It is likely to be used by plaintiffs and its advantage to the funded party is that it doesn’t have to pay back the amount if they lose the case. The funding firm gets a percentage of the shares only if the court judgement is won but the funding has to occur if it’s worth the risk.
Listed below are steps which are Followed when trying to get lawsuit financing.
Decide on the type of funding you need.
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There are two kinds of funding in Legal financing and you need to know which one you’re settling for its consequences. It can either be direct plaintiff financing whereby you’re given the cash to run the day to day legal expenses or legal cost financing whereby in settling the lawsuit costs, a check is sent to your attorney from time to time.
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Involve your lawyer.
Your attorney is a major determinant on your process of obtaining legal Financing since he wants to Answer several questions regarding the situation and filling of some paperwork hence The should let him Understand the facts along with your intention to get funding.
Be Aware of litigation funding companies.
Find out about litigation funding companies and the various kinds of injuries for which they offer funding and their area of coverage.
Research on the companies you’ve chosen.
When you have finally decided on the company to source funds from, research On the company to learn whether it is qualified and pay attention on the complains. You could also visit their offices to find out its physical location.
Assessing the strength of your case.
Consult your attorney to find out if your case is strong enough to obtain Funding and how essential it is.
Taking into account the proceeds from winning the court judgement that will go into the payment of the lawyer and the legal funding company incorporating the interest, consider if it’s worth it. If there are other cheaper options like sourcing your funds from family and friends then settle for that.
Enquire all requirements and what It means to find the funds.
This can be done best by asking questions in the firm itself like The percent they are willing to fund, the interest rate they will charge you around the funds they give you as well as any hidden fees. Find out about any additional services they provide and if they attract additional charges.
One can now confidently apply for the authorized financing providing the necessary information through the right channels.
Read the contact thoroughly and understand before signing. If you agree with everything in it, you can the append your signature.
Depending On the station of receiving money, check out if you have gotten the amount.