Legal funding, mostly known as litigation Financing can be known in some areas as litigation financing. It is a mechanism through which law firms or even individuals finance their legal costs by the help 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 receives a proportion of the shares only if the court verdict is won but the funding has to occur if it’s worth the risk.
Outlined below are steps which are followed when trying to acquire litigation 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 lawyer is a major determinant in your process of acquiring legal financing because he needs to answer a few questions about the case and filling of some paperwork hence the need to let him know the facts and your intention to acquire funding.
Look out for lawsuit 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 have chosen.
When you have finally decided on the business to source funds from, study About the company to find out whether it is qualified and pay attention on the complains. You could also visit their offices to find out its physical location.
Analyzing 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.
Considering the proceeds from winning the court judgement that Will go in the payment of the attorney and the legal financing company incorporating the interest, consider if it is 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 from the company itself like the percentage they are willing to fund, the interest rate they will charge you on the funds they give you and even any hidden fees. Find out about any extra services they offer and should they attract additional charges.
One can now confidently apply for the legal financing providing the necessary information through the right channels.
Read the contact thoroughly and understand before signing. If you concur With everything in it, you can the append your signature.
Depending On the station of getting money, check on whether you’ve received the amount.