Law Firm Loans
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Low Interest Rate Lawsuit Loan
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Alternative Funding Method For Attorneys & Law Firms
It can be difficult to find the money you need to fund your business if you’re running your own law firm; especially if you’re a new attorney and haven’t established yourself yet.
While seeking investment from friends and family can be helpful, it’s not always practical or possible to get enough funding this way.
Thankfully, there are plenty of alternatives out there that can help you get money when you need it most.
Our pre-settlement funding company can provide low-interest rate law firm loans or lines of credit to lawyers who need money to keep up with the expenses occurring due to ongoing lawsuits.
Attorney loans can be an invaluable resource for any law firm but are also a solemn commitment.
In order to ensure that your loans for attorneys continue to be a positive asset for your business. It’s important to take time and do your homework before applying.
Here’s a quick checklist of what you need to know when obtaining attorney loans: –
- How much will my loan cost?
- What interest rate am I being charged?
- Am I required to pay any fees or collateral?
- How long will it take me to get my loan?
All of these factors may vary depending on where you go for a loan, so do your research and find out what type of lender is right for you.
Understanding The Benefits Of Our Law Firm Loans
There are several benefits associated with our law firm loans.
The one that attorneys will appreciate is that these loans usually offer low-interest rates, which can help with managing cash flow.
If a law firm has good credit, it could consider applying for a loan with better terms than if it were to get an unsecured loan from a bank or credit union.
Attorneys who need short-term financing should consider law firm loans because they can be obtained quickly, and there are no long application processes.
Law firms that need long-term funding may also be able to obtain financing at lower interest rates than would be available through other sources of capital, such as commercial lenders or angel investors.
With law firm financing, you can pay off your monthly bills in less time, manage cash flow and pay your attorney’s monthly salary.
How Does a Law Firm Loan Work?
A third party usually handles law firm financing, such as a bank or an independent financial institution.
These institutions can help law firms fund non-revenue-generating expenses; such as computer equipment and furniture, through loans or lines of credit (LOCs).
Law firms can also receive money from banks to cover operating expenses like paying employees and rent.
A law firm agrees to pay higher interest rates on its loans in exchange for cash infusions that it might not otherwise have access to.
And while you may be able to negotiate with banks or lending institutions for better rates, it’s not always possible: Most legal entities aren’t eligible for bank loans because they don’t produce revenue, limiting their borrowing power significantly.
But at ECO, we are helping attorneys and law firms with low cost loans that can easily make up their pending expenses with very little restriction.
We understand that law firms don’t have collateral like other businesses. Therefore our funding agency offers loans against the lawsuit, in which the law firm is an active participant.
How Do I Get a Law Firm Loan?
Law firm financing can be tricky, and not just because a cash-strapped legal office has little in common with a commercial borrower.
Law firms are less likely to have assets that can be used as collateral for a loan—most law offices don’t even own their office space.
When law firms do borrow money, it’s usually to finance an acquisition or major expansion, neither of which involve starting up new operations or making operational improvements.
The market for loans made specifically to law firms is also quite small and in some cases, largely limited to attorneys themselves or very large corporate lenders.
Nonetheless, there are two primary ways that law firms manage to get access to financing: through peer-to-peer lending companies like ECO and from traditional banks.
The Costs Involved in Getting Loans For Attorneys
A common misperception about attorneys is that they have a lot of money.
In reality, you can’t make an hourly wage for most legal work, so it takes some time to build up your business.
That being said, loans are often needed in order to get a law practice off of the ground or to continue your operation as an attorney after encountering a setback or tragedy.
However, getting loans for attorneys isn’t always easy—there are costs involved in applying for these loans and many professionals opt-out of applying because they don’t understand what it will cost them upfront.
If a lawyer is considering taking a loan for the lawsuits, it’s good to know that there are additional costs involved in doing so.
Legal finance companies charge borrowers a monthly fee based on an interest rate (typically 20-30%), and there are often fees for other services (such as processing paperwork).
However, at ECO, we charge something between 15%-30%, which is exceptionally low compared to other attorney funding companies.
The Repayment Terms Of A Lawyer Loan
You normally have to repay a loan with interest when you take out a loan.
However, most loans issued by financial institutions and banks do not require interest to be paid until later on in the repayment process.
Lawyers are not subject to these same regulations when they borrow money, which means they have more options for repaying their debt.
This may mean that their loans are much easier to repay, but it also means that they need to stay on top of things so as not to fall behind in their repayment schedule.
Failure to pay back a loan could result in a court order mandating payment or possibly even result in criminal charges being filed against an individual who has failed to repay his or her debts on time.
How Can I Take Advantage Of These Lawyers Loans?
There are two types of lawyers loans that are available to lawyers, starting with a business line of credit.
A lawyer can apply for either an unsecured or secured business line of credit.
Unsecured is best for people that have an existing relationship with their bank and only want access to about $10,000.
They also take about four weeks to close and come at low interest rates.
Secured lawyers loans are taken out by someone looking for a bigger amount like $100,000 and come in through a hard inquiry on your credit score (it could affect your ability to get future financing).
This allows you to own all your assets in place as collateral until you pay off your loan balance within 10 years or refinance.
For most attorneys, taking out a loan to start or expand their business might seem like something that’s reserved only for doctors and other medical professionals, but it’s not true at all.
If you’re starting your own law firm, expanding your current law firm, or just need to take out some extra cash to get through the month (or year); you might qualify for a small business loan from our law firm loans company.
To find out if you qualify for law firm financing, call 800-961-8924.
What Is The Future Of Legal Funding In 2022 And Beyond?
Legal funding is nothing new, but its use in law firms is more likely to increase.
More and more people are turning to outside sources to make ends meet while they’re out of work or getting started.
At law firms, legal funding can help lawyers take on cases others might not be able to afford.
Law firm loans won’t necessarily replace other types of financing, but they will be an option for some clients and firms.
- What kind of client will you look for?
- How much money do you need?
- Is it a single case or many smaller ones?
You have many questions, which means now is a good time to connect with our representatives!
Get Law Firm Financing Quote
If you need money for your law firm, we can offer you financing without any hassle.