You’re involved in a personal injury case and there is pending litigation against the defendant. You have a need for capital now and are exploring your options. This is typical in a pre-settlement and lawsuit funding cases. We can assist by helping to advise on the best practices on how to approach a firm to discuss lawsuit lending before your case is settled or dismissed.

Don’t Get Slow Walked Into An Inferior Settlement

Lawsuits are as American as apple pie. It seems that everyone knows somebody who has racked up a settlement for something. If it is a person we know on a more than casual basis, we are also likely to know that the process is not as simple as filing a claim and getting a check in the mail next Thursday. The time that elapses between actionable event and final settlement can be years, even decades, in duration.

As the legal axiom goes, “Justice delayed is justice denied”. So far as the court system is concerned, however, it is just a tedious part of the game where the wheels move very slowly. It is also true that one party to the dispute has a great interest in getting a settlement done right away while the other party has numerous reasons why it would be better for them if the matter gets delayed indefinitely. If for no other reason, dragging things out makes the injured party more anxious to settle and move on with their life.

This tactical decision to slow things down in hopes of breaking the determination of the opponent has led to many sudden compromises that usually redound to the credit of the side with the most patience and money to wait out the process. Largely as a defensive measure, victims have been driven to seek out ways of leveling the playing field.

For this reason, a new industry has sprung up in the personal injury business which is known as pre-settlement funding or also as a lawsuit advance. The idea is quite simple. A firm or individual with a lot of risk capital available agrees to allocate a portion of that money to someone who has a pretty solid claim and is likely to prevail in court, no matter how long it may take.

The big wildcard for them in this form of investment is that it operates very similar to how personal injury attorneys function. Unless the claim pays off, the investors get zero back just like an attorney who agrees to work on a contingency basis gets nothing if the case goes against him.

There are a few funding scenarios that a pre-settlement may fall under. Those are as follows:

  • Premises liability
  • Motor vehicle accident
  • Wrongful death
  • Settled cases

Below we break down what premise liability, motor vehicle, wrongful death, and settled cases mean when it comes to getting an advance on your lawsuit or litigation case.

There are four major categories of cases that typically attract pre-settlement funding

Premises Liability

Premises liability laws are based on the idea that someone who is in possession of land or premises has a duty to keep them reasonably safe for everyone who is there. Being in possession can mean more people than just the owner. It can also mean a tenant or even a sub-lessee of all or part of the premises such as a vendor renting a space in a convention hall.

They have a positive duty to warn of hazards which might not be obvious and a general obligation to keep the area in a state that would be safe for anyone to be in. In some jurisdictions, these obligations are somewhat modified in the event that the injured party was not on the premises with permission. In such cases, the courts may consider how much of their injuries are their own fault and if it is found to be preponderantly them who caused the injury, they are not eligible for damages.

Wrongful Death Lawsuit Advance Services

Wrongful death occurs when someone is injured to the point of death due to the negligence of some other party such as a company or another individual. The surviving members of the immediate family, such as parents, children, and spouses, are eligible to claim wrongful death damages. In some jurisdictions, members of the extended family, such as grandparents, also have rights in this matter.

Regardless of who files for damages, the general purpose of those damages is to compensate the claimant, so far as possible, for being derived of their loved one in both an emotional and financial way. Wrongful death claims often derive from workplace accidents, car crashes, defective products, and medical malpractice. Claims are not restricted to just these things, but they are the most common causes of wrongful death actions. So far as the surviving family members go, they are often deprived of the primary breadwinner and need something to keep them going until the settlement is worked out.

Motor Vehicle Injuries

Pre-settlement funding is very common in motor vehicle injury cases. Not only are there large numbers of cases coming onto the court docket every day, but a lot of these cases are not immediately settled so far as who is at fault. It can take time to work out who is actually responsible for the event and thus which insurance company is obligated to pay on the claim.

Yet the physical injuries and loss of livelihood start on Day One. Often there are issues of repairs or replacement transportation to be considered. There are also questions of late appearing symptoms which can lead to re-filings in court and renegotiation with the insurance carrier. These can all put the process back to square one even if weeks or months have already passed.

Settled Cases

Just because all the parties have reached an agreement in principle doesn’t mean that the process is over. There is quite a lot of paperwork and red tape to plow through. Even when this is done, it may still be a while before the finance department cuts a check. All of this can lead to renewed bouts of anxiety since the victim is still not free to resume their life. Yet they may have plans already in motion that need some seed money to get them rolling. Even though the case is technically finished to their satisfaction, the plaintiffs may need money to cover bills and other expenses while waiting for the actual payout.

Common Factors

No matter how an injury was incurred, the major points of interest to a pre-settlement financial agent is the likelihood of victory in court and the amount of settlement which is anticipated. It is pertinent to note that these firms do not advance major percentages of an anticipated settlement. Instead, they base their offer on what you are likely to require in order to meet expenses while the case drags on.

You are free to use the money you receive in any way you wish. Yet it might be best to put off planning a round-the-world cruise until the matter is fully resolved. It is relevant to note that these companies charge interest on the money they provide. Since the risk of losing their entire investment is small but not zero, they tend to ask for pretty large percentages.

The less you can draw off the top of your settlement and the smaller the interest you pay on that advance will be to your benefit in the long run. Most people do not have the resources or capital to wait for months on end while these issues grind through the legal system. Pre-settlement funding can shorten that process once the other side realizes you cannot be starved out, which is a significant bonus.

Since most personal injury lawyers have long experience in these matters, they are the ones best able to advise how to proceed and what are the requirements in your own locality. In addition, they are aware of which firms offer the best deals and easiest qualifications for funding.\r\n

Who are the biggest names in pre-settlement funding?

There are a few names that stick out but there is no one JG Wentworth in the pre-settlement funding world but rather a handful of smaller players. Those players are Golden Pear Funding out of New York City, American Legal Funding & Oasis Legal Finance also known as Oasis Legal Funding. In our upcoming preview we will break down these companies and let you know who is legit and who is not legitimate.