Advantages of Legal Financing

Legal financing is often the preserver or maintainer of a lifestyle while a plaintiff awaits the outcome of a case. While borrowing money is always expensive, and lawsuit advances is more expensive than a traditional loan, legal financing can be a viable option for plaintiffs who are facing a financial crisis. For those who are involved in a lawsuit and are awaiting the proceeds of that lawsuit so they can settle debts and replace lost income, legal financing can mean the difference between maintaining a lifestyle and becoming homeless!

While many people assume they can “tough it out” while awaiting the outcome of a lawsuit, legal cases can take many months–sometimes even years–to settle. While their lawsuits work their way through the legal system, plaintiffs who cannot work face eviction from their homes, repossession of their cars and harassment from collection agencies. It is not uncommon for lawsuit plaintiffs to have their electric, gas and telephone services cut off! Even when plaintiffs awaiting a settlement might make it through the process without losing their homes and cars, they end up with their credit ruined or so severely damaged that it may take years to rebuild their credit ratings.

It is a common problem for a plaintiff to finally receive the proceeds of his or her lawsuit, but find that the ensuing financial pressures have created severe lifestyle changes. The plaintiff may be without a home, without transportation to get to work, and without the credit rating to get a credit card or an auto loan. For many plaintiffs, legal financing can provide critical cash at a critical time that means the difference between maintaining a reasonable lifestyle and being left homeless, transportation-less and penniless!

If a lawsuit plaintiff has access to less expensive sources of financing, LawMax always recommends that plaintiffs consider them first. Plaintiffs may have the option of borrowing against or cashing in their 401-Ks or other retirement funds. Some may be able to secure low interest loans from their credit unions. Plaintiffs who are carrying life insurance policies with a cash value can borrow against their policies. However, if a plaintiff cannot get money from sources such as these, and cannot secure traditional funding, LawMax legal financing is a viable option that enables lawsuit plaintiffs to maintain their lifestyle while awaiting the outcome of a case and their return to work. In difficult circumstances, legal financing can replace lost income and can remove financial pressures, allowing the plaintiff a chance to return to their life as quickly and as seamlessly as possible after a lawsuit has finally settled.

It is also important to note that lawsuit loans from LawMax do not affect the outcome of a case. Since legal financing is a stake against the plaintiff’s portion of the settlement, the attorney’s fee arrangement is not affected. The money advanced to the plaintiff only needs to be paid back in the event that a case is won or settled out of court. This means that the plaintiff and attorney continue to make the choice between going to trial or negotiating an out-of-court settlement based on their best interests and judgement. Should the plaintiff be forced to abandon the case, or should the case be lost a trial, nothing is repaid to LawMax. The advance is the plaintiff’s to keep!

If a plaintiff is falling behind on rent, loan and credit card payments, legal financing will often provide cash that allows the plaintiff to make minimum payments and stay current while awaiting a return to work and proceeds from the lawsuit. When the plaintiff does finally receive his or her settlement, it can be used to pay off the bills that have accumulated. In the meantime, legal financing can mean the difference between financial disaster and continuing to live comfortably.