When a plaintiff obtains a lawsuit cash advance, otherwise known as pre-settlement funding, case loan companies require the signature of the attorney to finalize the transaction. Attorney cooperation in the lawsuit funding process is the single most important factor in obtaining cash now for your case. Below is a list of important reasons why legal finance companies require attorney cooperation in lawsuit funding.
The name of the game in lawsuit funding is speed. Clients are often at the end of their financial rope when they decide to pursue a lawsuit loan against their case. The best service is the fastest service. And the best way to achieve this aim is to gain the confidence and cooperation of the attorney’s office and staff.
99% of the delays in funding are due to chasing the proper paperwork. This can be remedied with clear communication of exactly what paperwork is needed and why.
Of course, attorneys and their staff are very busy people and are not always going to drop everything they are doing to facilitate a lawsuit loan. Often support staff has to rifle through voluminous files searching for relevant documents. Through cooperation however, documents are obtained as soon as possible and the funding process runs much smoother.
Lawsuit funding companies are in the business of advancing money for profit. The real trick is not sending the money out, but getting it back in.
Normally, when the lawsuit settles, the defendant (or the insurance carrier) issues a check to the plaintiff which is deposited into the attorney’s trust account. From there, the attorney disburses the funds to his own firm, the client and any liens which are outstanding. A lawsuit loan is such a lien. Because the attorney ultimately has to pay the cash advance back to the lawsuit funding company, it is generally a good idea to have a cooperative relationship with that individual and his staff.
Unfortunately, we occasionally encounter persons operating from a scarcity mindset who, in an effort to ease their own pain, offer inaccurate information to lawsuit funding outfits. The vast majority of this misinformation is flushed out by various mechanisms, however, the essence of the problem still remains. Certainly, lawsuit funding collection efforts would be greatly affected if the investment and return had to be retrieved from the clients themselves. Instead, funding contracts require the proceeds from any settlement or award first be deposited into the attorney’s trust account and then disbursed to the interested parties. This requirement is implemented industry wide, with few exceptions.
Attorneys spend a large part of their practice following rules. They are in a privileged position to offer advice to clients and are also regulated by professional conduct standards. Rarely would an attorney knowingly stick his neck out for a client whose intentions are less than honorable. The attorney simply has nothing to gain from holding back payment on a lawsuit funding repayment. Knowing this, lawsuit funding companies trust attorneys to honor the obligations of their clients. The result is a successful exchange in value from all involved.
A lawsuit loan is an above board transaction. For the reasons set forth above, and others, attorney cooperation helps keep it that way.
Thank you for your interest in the lawsuit funding business.