What Is The True Value Of Settlement Loans And Lawsuit Funding?

Many of our clients voice concerns about costs involved in lawsuit funding and settlement loans. It is astounding to be confronted with misconceptions surrounding this relatively simple form of financing known as, among other things, lawsuit funding and settlement loans. Although this form of funding is increasing in popularity, it remains an instrument about which most, to include plaintiffs and their attorneys, lack familiarity. In reality, pre-settlement loans are readily available for a vast array of claims. Far fewer, however, have any clue of many of the gems that emanate from litigation funding.

We have written in the past regarding misconceptions involving interest rates and pre-settlement loans. As stated previously, there are no interest rates involved in such transactions. Remember, they are not loans. The only reason many entities involved in providing these transactions include terms related to loans is because many individuals seeking such assistance use that as one of their search terms.

Additionally, we suggested ways in which plaintiffs who obtain lawsuit funding and/or settlement loans charge expenses related to such funding against the defendant. Although there are no interest rates, there are risk fees. The risk fees will be contingent on the risks inherent in the case for which funding is sought.

Predictably, the vast majority of clients assure us that their cases are "slam dunks." Unfortunately, there are few, if any, cases that are a "slam dunk." Take into consideration the plaintiff who, as a pedestrian, was struck by an automobile. The plaintiff assured us, "My case is a slam dunk!" (That may have been the case with merely a cursory view.) Contrariwise, the police report provided militating evidence: (1) the plaintiff was dressed from head-to-foot in dark clothing; (2) the collision occurred at night; (3) it was raining; (4) the plaintiff was walking in the roadway; and (5) the Incident report stated that the pedestrian was "drunk." Getting suspicious yet?

Back to the purpose of this article! This article is intended to illustrate that lawsuit funding and/or settlement loans may beneficial in another way. The vast majority of you are familiar with the term "mock juries." Individuals who work as jury-consultants generate millions of dollars working with lawyers to select the most likely venue and jury-pool with which to prevail in a particular lawsuit.

What is the primary purpose of mock juries? Naturally, they are intended to allow both plaintiffs and defendants to observe the strengths, as well as the weaknesses of a particular case, through jurors' eyes. It is significant to be able to garner this information objectively. It is the jurors, with guidance from a judge, who will determine the plaintiff's/defendant's fate if the case is not settled prior to trial. Those who fund lawsuit loans will thoroughly review the elements of the cases submitted for pre-settlement loans. Due to the fact that such funding is non-recourse, if the plaintiff loses his/her their case, the funding-company collects zero.

Once the application is submitted for either lawsuit funding or settlement loans, the application, as well as relevant documents will be reviewed by those who specialize in litigation funding. These experts will analyze the information received and determine if additional information is required. The additional documents required may prove tremendously valuable to the client in making his/her case. An example of required documentation, but one often not made available by individuals seeking pre-settlement loans in breach of contract cases, is the written offer. To succeed, the plaintiff must clearly establish liability. Additionally, the defendant's ability to pay any judgment likely to be awarded must be considered. A judgment of a monetary award is of little value if the plaintiff is unable to collect.

When utilized appropriately, lawsuit loans provide tremendous financial relief for many plaintiffs. However, the value of having individuals with years of experience in reviewing such cases evaluate claims submitted and for which lawsuit funding is sought, is incalculable. Bear in mind, the funding entity is looking for reasons to provide settlement loans.

Interested in learning more about lawsuit funding? Please visit us today. There you may learn more about lawsuit settlement loans and even apply online for settlement loans.