LAW PRACTICE CASH FLOW MANAGEMENT 101

Question: What is “Litigation Funding” (Litigation Finance), an “Attorney Loan” or a “Law Firm Loan” and what is the purpose of it?

Answer: Just like every other business, to a legal practice, cash flow is it’s lifeblood; without sufficient law firm cash flow at all times, the practice will die. Litigation financing, a law firm loan or a law practice line of credit is a law firm cash flow management tool that is used to reduce financial risk exposure while at the same time preserving the firm’s precious cash reserves. It can also be used to offset the cost of litigation, especially on larger or multiple cases, and generate cash (without incurring a debt liability) to maintain business operations while the firm waits for payment of it’s contingent fees from settled cases.

Question: But lawyers make a ton of money, right? So why would an attorney or law firm need to finance litigation costs or borrow litigation costs? Why not just pay for them outright in cash?

Answer: Because the cost of litigation can be EXTREMELY expensive, that’s why. Obviously, if the law firm cash flow picture is such that it is capable of paying all it’s litigation costs comfortably, then litigation funding is unnecessary. However, tens of thousands of law firms and individual attorneys simply do not have the cash reserves in place to fully fund every case they get. For them, litigation finance or a law firm line of credit can be their best option for growing their legal practice cash flow safely and affordably.

Most personal injury attorneys get paid on contingency so a line of credit for law firms makes perfect sense. In other words, they only get paid if they win or if the case settles favorably. But up until the point that it does, the attorney or firm normally pays all costs and expenses of filing and developing a case; this usually includes their legal fees and filing fees, depositions, discovery expenses, travel expenses, expert witnesses, travel expenses for expert witnesses, private investigators, surgical opinions, forensic support, litigation support staff, etc. And many times the list just goes on and on.

For one case the cost of litigation can be expensive. For an attorney or law firm with a sizable caseload, litigation costs can easily become an overwhelming financial burden. The worst thing in the world for an attorney is when they must refer a promising new case elsewhere because they just don’t have the financial resources to take it on.

This is where litigation finance or a law firm line of credit can save the day.

Litigation funding is a specialized type of law firm loan for legal practice expenses, with several distinct advantages over conventional bank loans. Banks require an attorney to pledge personal property (typically their home) as collateral for a loan. The loan also appears as a debt liability on the firm’s balance sheet. And last, they must make regular loan payments, usually starting the month after the loan is disbursed.

While betting one’s home on the outcome of a case is risky enough, having the added burden of making monthly loan payments for months or even years before the case(s) settle can be devastating. Something more specialized is needed.

TriMark Capital Funding, Inc. understands the latent value that’s tied up in pending lawsuit settlements, so our non-recourse attorney loans, law firm loans and law firm lines of credit are designed to work in favor of the attorney within the unique confines of the contingent fee litigation relationship.

Litigation Funding for Attorneys and the Law Practice Line of Credit; We’re in business to help attorneys do a better job:

• Instead of worrying about how or where your firm will get the money to pay it’s bills and litigation costs, we free you up to focus 100% on what you do best; WIN YOUR CASES.
• Instead of pledging your home or other personal property as collateral for a bank loan, we look at the quality of your pending caseload. We understand that good quality cases make good quality collateral.
• Instead of incurring an additional debt liability on your firm’s balance sheet by taking out a loan, you’re simply leveraging a future asset.
• And instead of requiring you to make monthly debt payments when you can least afford it, we wait for your cases to settle. In fact, we don’t get paid back UNTIL your cases settle. And because our litigation financing options are non-recourse, if for some reason they don’t settle or you lose, YOU OWE US NOTHING.
• Best of all, we NEVER interfere with your case management or try to tell you how to prosecute your case(s); you will ALWAYS remain in 100% control of your case(s). We are merely your financial backing.

If you have clients who are in need of cash immediately, we can also help them with a lawsuit cash advance too. You can learn more here: Plaintiff Lawsuit Funding.

To learn more about how Litigation Funding can help you grow your legal practice cash flow, visit LawsuitLoanHQ.com today or call us toll-free at 1-877-932-2628.

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Many plaintiffs who are involved in personal injury lawsuits are unaware that they may be able to get a cash advance on their settlement BEFORE their case actually settles. It’s called lawsuit funding or pre settlement funding and also goes by a variety of other names too; personal injury settlement loan, lawsuit loan, litigation funding, legal funding, legal finance, settlement loan, pre settlement funding, litigation financing, non recourse funds for plaintiffs or lawsuit cash advance.

1. What is a “Lawsuit Loan”?
Well, for starters it isn’t really a loan. ‘Lawsuit loan’ is a term that’s in common use, but technically speaking, what we actually provide are non recourse, contingent cash advances against pending personal injury lawsuit settlements.

Lawsuit funding is NOT a loan because it has no set repayment term, no set repayment schedule and no monthly payments like a loan does. And repayment of a lawsuit cash advance is not absolute like a loan either; it is contingent upon the successful outcome of the plaintiff’s lawsuit. Non recourse means that if you lose your lawsuit or your case doesn’t settle, you DO NOT have to repay the money that was advanced to you. And unlike a loan, pre settlement funding approval is based solely on the merit of the case, NOT on a plaintiff’s credit score, debt-to-income ratio, present income, assets or employment history.

From an investment standpoint it is one of the riskier, more speculative types of investments. From a plaintiff standpoint, it can be a real lifesaver for people who need money now and have nowhere else to turn.

2. Why would someone need “Pre Settlement Funding”?
It’s pretty common for people involved in personal injury lawsuits (called plaintiffs) to get behind financially. It makes sense if you think about it. After all the very nature of ‘personal injury’ implies that they’re hurt, often severely, which means they’re unable to work and thus, aren’t receiving a paycheck. Emergency funds get exhausted, credit cards fill up and they need somewhere to turn.

Their pending personal injury settlement can be a large asset, but it’s a future asset; certainly one that banks won’t accept as collateral for loans. That’s where specialized investors like TriMark Capital Funding, Inc. can fill the gap. We recognize the latent value of future personal injury lawsuit settlements and can help plaintiffs who need money right now by leveraging a small portion of that future asset.

3. Is there a maximum ‘settlement loan’ or ‘lawsuit loan’ amount?
It depends on your case. How much money you can get as a cash advance on your personal injury settlement depends on the particulars of your case, the severity and permanence of your injuries, the level of the defendant’s liability and the defendant’s insurance coverage, just to name a few of the variables. For pre settlement funding and lawsuit cash advances we will normally go up to about 10% to 15% of the anticipated settlement amount. Our minimum settlement funding amount is usually $1,000 (we can go lower on a case-by-case basis) and the maximum amount available on a single case is usually limited to $500,000 but we can go higher than that on a case-by-case basis if necessity warrants and the case supports it.

4. Who is eligible for a Lawsuit Funding Advance?
If your attorney is paid on a contingency basis and you are the plaintiff in any type of workers compensation, class action lawsuit, serious personal injury (emphasis on serious; we do not fund on minor injury, frivolous or ’soft tissue injury’ cases) or wrongful death lawsuit then chances are good that you may qualify for a lawsuit cash advance or legal funding. Typical cases include personal injury, serious car accidents, serious motorcycle accidents, slip and fall injuries, premises liability, asbestos mesothelioma, traumatic brain injury (TBI), spinal cord injury (SCI), medical malpractice, commercial litigation, wrongful death, workers compensation, class action lawsuits and much more. You can click here for a complete list of eligible case types.

5. What are the biggest benefits of lawsuit funding?
Time and peace of mind. Since your bills and financial obligations will be paid, lawsuit funding can buy you the peace of mind you’ve been lacking since your financial hardship began. And when you have peace of mind you can concentrate on getting better. And pre settlement funding can buy your attorney the time they need to properly develop your case to it’s full potential and negotiate the largest, most appropriate settlement possible so you get full value for your case.

6. Do I need to have good credit to qualify?
No, lawsuit loans or pre settlement funding is based solely upon the merit of your case – not on your credit score or employment history. The only exception is if there is a pending bankruptcy. Besides that, you could have bad credit and no employment and still qualify for legal funding.

7. Why not just get a bank loan instead?
If you can get a bank loan, by all means, get one. The trouble is most people can’t because they lack qualifying collateral and usually have damaged credit because of their financial hardship. Non recourse lawsuit funding is more expensive than conventional financing (bank loans for example) due to the increased risks incurred by the investor and should be considered a “last resort” financing option only.

8. Will the defendant, their attorneys or their insurance company be notified?
Absolutely not! Pre settlement funding cash advances are 100% confidential and very discreet. The ONLY ones who will know that you got a lawsuit cash advance are you and your attorney.

9. Can’t my attorney just lend me the money I need?
Unfortunately not. The American Bar Association expressly prohibits attorneys from loaning money to their clients for anything other then case-related expenses specifically to prevent a conflict of interest from arising.

10. What will my attorney say about lawsuit funding and will he/she have to give up control of my case?
Attorneys are normally sympathetic to the financial strain their clients are undergoing. They will probably advise you that lawsuit funding is expensive as compared to a bank loan for example and should only be considered as a last resort. This is true (see #7 above for more details) and any good lawsuit funding company will be very forthcoming about this.

And NO, your attorney will NOT have to give up control or management of your case. We have no interest in taking over your case or interfering with how your attorney is handling it. Applying for legal funding does NOT interfere in any way with the agreement between you and your attorney and it also does NOT interfere with your attorney receiving his fees when the time comes either.

You can learn more about Lawsuit Funding at www.LawsuitLoanHQ.com.

VIOXX LAWSUIT – VIOXX SETTLEMENT FUNDING

Well, technically speaking, Vioxx lawsuit loans are not actually loans at all; they’re non-recourse cash advances (also called Vioxx settlement funding) provided by lawsuit funding companies like LawsuitLoanHQ.com and will be repaid out of the pending Vioxx settlement that plaintiffs hope to begin receiving later this year.

In September 2007 Merck agreed to a $4.85 billion dollar settlement in response to lawsuits filed on behalf of people injured or killed as a result of taking the prescription painkiller Vioxx.

According to USA Today, as of today, more than 44,000 people have submitted either all or a portion of the paperwork required for them to be enrolled in the Vioxx settlement deal. People who enrolled by February 29, 2008 whose claims are verified will be eligible for an interim, partial payment due to begin being disbursed in August of this year.

Merck withdrew Vioxx from the market voluntarily in 2004 after one of its own medical studies revealed that Vioxx doubled the risk of stroke and heart attack. According to Merck, Vioxx accounted for $2.5 billion of it’s 2003 sales volume and approximately 15% of the company’s profit for that year.

Great question. The correct answer is that it depends on your situation.

Lawsuit funding (also called lawsuit financing, personal injury settlement funding, lawsuit pre settlement funding or simply a lawsuit loan) can be a real life-saver for people who have been injured and have a personal injury, wrongful death or other type of pending lawsuit against the defendant.

Typically when people incur a personal injury sufficient to warrant a lawsuit, their finances are usually affected as well because they often miss work or lose their job altogether. Bills still need to be paid and the money has to come from somewhere.

That’s where lawsuit funding or litigation financing comes in. With a lawsuit cash advance, the plaintiff can get a cash advance against a portion of the proceeds they are to receive from their pending lawsuit settlement. Then when the settlement finally pays, the lawsuit funding company gets their money back from the settlement proceeds.

This is called a non-recourse cash advance. That means if for any reason the plaintiff loses their lawsuit or their case doesn’t settle, THE PLAINTIFF IS UNDER NO OBLIGATION TO REPAY THE MONEY THEY WERE ADVANCED. There are no monthly payments to worry about either.

Plaintiff lawsuit cash advances are fast – you can often get cash within 24 to 48 hours and they are typically in amounts from $1,000 up to $100,000. For plaintiffs involved in commercial litigation, advances can go from $100,000 up to $10,000,000.

For more information visit Lawsuit Funding.