Legal financing, mostly known as litigation Financing can be known in some areas as lawsuit 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 financing firm gets a proportion of the shares only if the court judgement is won but the funding must happen if it is worth the risk.
Listed below are measures which are Followed when seeking to acquire litigation financing.
Decide on the type of financing you require.
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There are two kinds of funding in legal financing and you have to know which one you’re settling for and its implications. 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 an Important determinant in your process of obtaining legal Financing since he needs to answer a few questions about the situation and filing of some paperwork thus The need to let him know the facts along with your intention to get financing.
Look out for litigation funding companies.
Find out about litigation financing companies and the various Types of Injuries for which they offer funding and their field of coverage.
Research on the companies you’ve 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 might also visit their offices to discover its physical site.
Analyzing the potency of your case.
Consult your lawyer to find out if your case is strong enough to obtain financing and how necessary it is.
Considering the profits from winning the court verdict that Will go into the payment of the attorney and the authorized funding company incorporating the attention, consider if it’s worth it. If there are other cheaper alternatives like sourcing your capital from family and Buddies 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 firm itself like The percentage they are ready to finance, the interest rate they will charge you around the money they give you as well as any hidden charges. 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. Should you agree With everything inside, you can the append your signature.
Depending on the channel of receiving money, check on whether you have received the amount.