Lawyers and law firms face several challenges when their cases keep dragging on. Working on the case for years, which is generating no result, can be frustrating, and if you are working on contingency fees, this situation can worsen. We know that a lawyer has a practice to run, which is impossible if they don’t have a proper cash flow.
If you are an attorney working on a contingency fee, you might have many pending cases from which you are earning nothing. Since contingency fees can only be recovered after a trial is complete and the judgment comes in your favor with a settlement. We have a solution for you! You can take attorney funding.
But before you decide to take attorney funding, it is obvious to weigh its pros and cons. Here, we are providing brief information about the pros and cons of attorney funding. After this, you can get a clear picture of whether these kinds of cash advances can help your case now.
Understanding Attorney Funding
Attorney funding is a specialized cash advance designed for lawyers and law firms needing financial assistance with ongoing lawsuits. With these cash advances, you can easily cover the ongoing costs of your litigations, pay the salaries, and maintain cash flow in your law firm. Lawyers working on contingency fees have to wait for years to get paid, but with attorney funding, you can raise money for your pending cases.
We know that if the case keeps on dragging, you may suffer financially because you will stuck with no cash flow in a business, but with attorney funding, this problem can be solved. Attorney funding works in a way that you get money now. In exchange, you agree to share a portion of your future settlement award with us.
Borrowing cash for attorneys can be tough as their business is stringent, and you may not have enough collateral to get a loan from a bank. With attorney funding, you can get money by putting your pending court cases as collateral. If you have a strong lawsuit and are sure you will win a settlement, you can get attorney financing by agreeing to surrender a portion of your future award. Your pending cases will determine the amount you can get, our company can provide anywhere between $10,000 to $100,000 based on the list of cases your are handling and the cumulative settlement value it has.
Pros of Attorney Funding
One of the major advantages of attorney funding is that it’s easy to get and comes with little to no risk. Here you are going to get cash in simple steps, if you have a pending list of cases which is strong but are going to settle in future months, you can get cash against it. Getting traditional loans for a lawyer is very tough since they don’t have enough collateral to present. But with attorney funding, your pending court cases act as collateral, making it more convenient for attorneys to raise money against them.
Attorney funding maintains the cash flow in your law firm if your cases are pending for years. Working on contingency fees can get you more clients, but running a law firm requires cash flow. You have to pay salaries, pay for the litigation cost, and get expert opinions to make the case strong. An attorney’s funding can help you with that.
You can easily grow your practice without worrying about finances since attorney funding is a solution created just for lawyers and law firms to take cash when needed most. We understand that results can take years to come, and you can’t wait for years to get your fees, so you can have a part of your fees right now. In exchange, you return the money once you win the case and get paid.
The Downsides of Attorney Funding
A notable disadvantage of attorney funding is its interest rates. Although rates vary between loan companies, attorney loans generally carry higher rates than standard loans. Attorney funding is a risk-free loan for a lawyer because they only need to repay if they win, and in case they lose the case, no repayment is needed. Since the lender is the risk bearer in attorney funding, they can put higher interest rate.
Further, attorney funding is not allowed for all lawyers; only law firms that deal with personal injury claims, car accident claims, product liability cases, and medical malpractice claims can get cash advances. There are a few more cases against which a lawyer can get attorney financing, which you can check here.
Use Attorney Funding And Keep On Practicing
Many attorneys often stop taking new clients because they don’t have enough money to run their practice; they are overloaded with old cases that are getting delayed. They don’t have enough cash flow to get help and keep on taking new clients. Now, you have an option to raise money against those pending cases so that you can hire more people and get more clients in your portfolio.
Taking attorney financing reduces the financial hardship if you have poor cash flow. Contingency fees can only be recovered once the case settles. If they keep on dragging, the problem increases for a lawyer, which can now be tackled easily with attorney financing. Make an informed decision based on the pros and cons of attorney funding so that you can benefit overall by taking a cash advance. You can also learn more about plaintiff financing by reading about pre-settlement funding.