How Does Funding Work?
During these challenging times, you face many hard choices. PLF works to alleviate the need to compromise on the true value of your injury claim. Instead of settling prematurely, you can sell a portion of your claim to PLF for an advance and use the funds to allow the time required for your attorney to maximize the value of their claim.
- Is Funding Right for You?
What is Funding?
Legal funding, lawsuit loans, or lawsuit advances, are all synonymous terms which describe financing in the form of 'cash now' against the future anticipated settlement award. It is available to Plaintiffs who are involved in current or future litigation, and who have already hired an attorney.
Instead of settling your claim prematurely, effectively selling 100% of your claim to the insurance company for much less, you can sell 10-15% of their claim to PLF for an advance.
Why Choose PLF?
We are FAST: as a compact team, we are able to respond immediately and begin working to get you the help you need right away.
We are FAIR: we understand that your lawsuit can be a long process and provide an array of funding terms with maximum payoff caps.
We are No Risk: settlement funding is considered Non-Recourse funding, which means, you pay us when your case is settled.
Legal Funding vs. Other Options
Legal funding is not the only available option for plaintiffs. Before applying for legal funding, many plaintiffs approach more traditional banking institutions. The main difference between legal funding and other conventional banking solutions is recourse and payment schedule.
With most traditional options, there is no option for non-recourse funding, which means that any approval is based on credit history and income profile. Also, with conventional bank loans, there is a repayment period that could start as quickly as 30 days from taking out financing. This means that the plaintiff will have to make monthly payments and if the financial strain increases, they will be subject to a negative impact on their credit.
As mentioned before, lawsuit funding or a cash advance is non-recourse. Unlike a traditional loan, there are no monthly payments and no personal commitment to repay if the case does not settle. There may be fees on the funding advance but they are paid upon a successful settlement.
This is why legal funding is a preferred option for plaintiffs. It is a minimal risk to their personal credit, there are no credit checks for approval, and you do not need to pay it back until settlement.
Pre vs. Post Settlement Funding
The two main types of legal funding are Pre and Post Settlement funding.
In pre-settlement funding, your case is still in litigation, and there have been no accepted offers of settlement. In pre-settlement cases, funding companies normally pay up to 10% – 15% of the gross estimated settlement value of the case.
In post-settlement funding, there has been an offer for settlement for which the plaintiff has accepted. Funding companies can release up to 50% of the plaintiff’s net value after all attorney’s fees and liens.
