Lawsuit Loans: An Overview

Lawsuit loans , or lawsuit advances as they are more accurately called, can help plaintiffs in lawsuits avoid many financial difficulties. Justice is blind, but it can also be slow. While the legal system offers redress and compensation for plaintiffs who have been injured or who have sustained a loss, the process of actually getting the compensation can be lengthy. Even though plaintiffs are often in immediate financial need, it can take months or even years to resolve a case and actually receive a settlement. Lawsuit advances can bridge the gap between the immediate need for cash and a future settlement, since these advances offer money against the expected proceeds of the lawsuit. A lawsuit advance from LawMax can be put to use immediately to pay bills and replace lost income.

The Good News about Personal Injury Lawsuits

Under the US legal system, a person of modest means and resources can launch and pursue a serious lawsuit when he or she is the victim of a loss. A person need not be powerful nor wealthy to seek a fair settlement for his or her losses because many attorneys will take such cases on a contingency basis. This means that attorney fees are paid out of the proceeds of the settlement, and only if the plaintiff wins the case or reaches an out-of-court settlement. If the plaintiff loses, he or she owes nothing. This allows plaintiffs to initiate a personal injury lawsuit without upfront costs. The attorney bears all costs, and is only paid if the case is successful.

The Bad News about Personal Injury Lawsuits

While there are no upfront costs for the plaintiff, neither the plaintiff nor his attorney sees any money until the case is won. The attorney can easily invest many thousands of dollars in a case in just a few months. The attorney and his or her staff may have spent hundreds of hours working on the case, and paid out of pocket for private investigators or other services necessary to the case, but the attorney will not be paid until the case is settled–a process that can take months or even years. Even once a case is settled, the defendant can file multiple appeals and delay the settlement for months or years. For the plaintiff, this can cause serious problems, especially if living expenses, rehabilitative costs or medical bills have to be paid, and if the plaintiff cannot work.

The Role of Lawsuit Loans

Lawsuit loans provide funds to both plaintiffs and attorneys while personal injury and related lawsuits work their way through the legal system. Lawsuit advances can be used by plaintiffs to replace lost income and pay living expenses as well as medical and rehabilitative costs. For attorneys, lawsuit loans provide working capital for their practices so they can more aggressively prosecute their clients’ cases. LawMax advances cash against a bundle of lawsuits to provide attorneys with critical working capital.

When LawMax provides presettlement funding to plaintiffs, these advances are provided against the plaintiff’s share of the settlement. This means that if the plaintiff wins the case or settles out of court, LawMax will be repaid the advance plus the accumulated risk premium on that advance. If the plaintiff loses, LawMax receives nothing and the advance is the plaintiff’s to keep.

When LawMax provides attorney loan, these advances are against the attorney’s portion of the expected return on the cases presented to LawMax. Just as a personal injury attorney assume considerable risk in taking a case on a contingent basis, LawMax assume similar risks in providing non-recourse funding to lawsuit plaintiffs.