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Why your lawyer should encourage lawsuit funding

Jan 28th 2015 at 5:40 AM

Lawsuit lending companies sometimes do not get cooperation from lawyers. This could be due to

· The blanket opinion that it will cost the client too much

· The belief that the lenders make a profit out of the misery of others

· The lawyer does not view negotiating with a lawsuit funding company as part of his job

· The lawyer does not prioritize the case

Yet the service that lawsuit companies provide is quite beneficial to most. Below are 5 reasons why your lawyer should encourage lawsuit funding;


1. Not all lawsuit lending companies have unfair terms

Due to an increase in the number of lending companies, there’s more competition for lawsuit lenders and this has forced them to readjust their pricing to be friendlier to clients.

Some lawsuit funding companies make as low as 10% (including interest) of the settlement value; the cost benefit ratio for the plaintiff is very sensible in this case and it’s necessary for your lawyer to support the decision to take a loan and even offer advice.

2. Lawsuit funding does not have to hinder out of court settlements

Sometimes, lawyers decide to settle out of court.

Loan advances do not limit the decision to settle a case, should it come to that. This is especially so if the loan company charges a fair fee for the loan, thus the amount of the loan will be much smaller in comparison to the out of court settlement amount.

Your lawyer should ensure the inclusion in the loan contract of a clause that governs out of court settlements.

3. Lawsuit funding applicants need attorney cooperation

Your attorney is the one with expert knowledge on the proceedings of your case. Only from his legal standpoint can the funding company understand the possibility to win a lawsuit. Therefore, your lawyer’s involvement is required from the start in:

· providing documents related to the case

· participating in discussions that lead to approval

· consenting to the funding agreement as valid

Bottom line is, if your attorney has a winnable case (whether or not he has a good opinion on funding) he should recognize its value to you and to him towards winning the case and support it.

4. The more support the lawyer provides, the faster the case gets concluded

You are probably unable to raise money on your own, perhaps due to an injury that hinders you from working. You most likely need money urgently.

Lawsuit loans get quick approval. The faster the lawyer is providing support, the faster the loan will get approved.

If the attorney cannot find time to go to the funding company, he should hold the meeting at his/her work premises or email the documents to the lender and have a follow up discussion on the phone.

5. You, your lawyer and the funding company win

As with any other business, funding companies have business expenses that they factor into the amount they ask for from your settlement. This is because they have to operate at a profit.

Your lawyer should avoid renegotiating. The only negotiation that should take place is when signing the loan contract before the funding is provided. This way, everyone goes home a winner.

About the author


Charlie Brown is an accomplished lawyer with over 15 years’ experience in his profession. He specializes in personal injury litigation and has a lot of insight to offer on reputable lawsuit funding companies that give funding to plaintiffs. Visit his site to read more at

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