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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