Lawsuit Loan Process Provides Much Needed Support
Lawsuit loans provide financial support to plaintiffs while they wait out the legal process. In this post, we discuss the lawsuit loan process and what issues routinely arise. The following are the steps in the lawsuit loan process:
Investigation and Application
The lawsuit loan process begins with a plaintiff exploring their financial options. Often this exploration involves reading articles on lawsuit funding blogs or reviews of lawsuit loan companies. When a client decides lawsuit loans are something they want to pursue further, they likely will complete an online application form or call a funding company.
Likely the application form will include the plaintiff’s contact information, type of case, and attorney name. From there the form is submitted to the company. More often than not, a lawsuit loan company will call the applicant for some more information.
Based upon that conversation, the applicant will either be denied or pre-qualified for funding. When a plaintiff is pre-qualified, that means the company is willing to spend its time and resources trying to get the plaintiff approved. Simply put, if you are pre-qualified for a lawsuit loan, the company thinks there is a chance it can help you. It is the first step in the lawsuit loan process.
Chasing Paper in the Lawsuit Loan Process
After pre-qualification, the real work begins. This involves all parties (client, funding company employees and attorney’s office and staff) coordinating efforts to get the deal done.
The first step in the lawsuit loan process involves the funder contacting the attorney with a request for information. This can include a fax, text, email or phone call. Often it involves some or all of these modes of communication. The request will read something like this:
Your client, Joe Plaintiff, contacted our firm for a monetary advance against the potential future proceeds of his/her lawsuit, which your firm is currently handling. These funds are needed by your client to pay bills and other necessities of living. Since our company will not get paid back unless your client’s case is successful, we ask that you provide the following documents so that we may assess the viability of this case. The documents that we require are the following:
– Incident/Accident Report
– Witness Statements
– Medical Records (ER & Initial Medical Evaluation, MRI’s, Operative Reports)
– Copy of Complaint
– Insurance Coverage Information (Policy Carrier & Limits)
– Settlement Offers/Demand
– Notice of Prior Defect
-Color Photos of Scene
-Payoff from Previous Funder
Thank you for your time and attention in this matter.
Once the initial request is made, the ball is in the law firm’s court and they can handle the request in any number of ways.
- They provide the necessary documents – this is the best choice for obvious reasons and will provide the quickest outcome for plaintiffs in need. Truth be told, more busy personal injury law firms are familiar with lawsuit funding requests. This wasn’t always the case but it is now. The lawsuit loan process is simply part of every plaintiff’s law practice in today’s legal landscape.
- They ignore the request – this is obviously not ideal but the reasons for ignoring the request can range from an unwillingness to participate in the lawsuit loan process to simply not having the time to respond quickly. Most lawsuit loan companies allow 24 hours for a law firm to respond to requests for information.
- They partially provide requested documents – this is a common occurrence mainly because some of the documents requested are not yet available. Under these circumstances, the lawsuit funding process continues on as lawsuit funding underwriters attempt to fill in the gaps during the underwriting process.
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Lawsuit Loan Underwriting Process
Underwriting is the detailed analysis and consideration of the financial risks involved in a particular investment. Underwriting is an essential part of the lawsuit loan process.
Review of Documents Provided
Whatever paperwork is received is passed along to the lawsuit loan underwriter assigned to the file. These can include a copy of the complaint, evidentiary exhibits, photos, videos, medical records, expert reports, etc.
Contacting the Attorney
Once the documents are reviewed, the lawsuit funding process dictates the representing lawyer be contacted. This is usually done by a phone call but is sometimes done with email correspondence, especially if the attorney has worked with the funding company previously.
During the communication, underwriters will ask a variety of questions about the status of the case, settlement negotiations and any foreseeable obstacles or challenges.
Based upon the attorney/underwriter communication and document review, the company will determine whether to make an offer. The amount of the offer depends upon a variety of factors and is normally capped at 10-15% of the case’s expected settlement value. Once the lawsuit loan process reaches this point, the offer is communicated to the client and the company awaits the decision.
Execution of Documents
When the client decides to accept the offer, the funding process begins. First, a contract is prepared and forwarded to the client and the attorney. Other documents include how to deliver the proceeds (bank account information or overnight delivery address). When the documents are returned, the file is placed in the queue for funding.
Final Lawsuit Loan Process – Funding and Follow-up
Once money is delivered, clients are at liberty to use the money any way they see fit. Although there are no restrictions on how to spend the lawsuit loan proceeds, most plaintiffs use lawsuit loans to pay for:
- Medical treatment
- Living Expenses
- Rent or mortgage payments
- School tuition and/or fees
- Property damages
Delivery of the funds is not the final step in the lawsuit loan process. For the lawsuit lender, the monitoring continues until the case’s ultimate resolution. Some lenders monitor their investments monthly. Others contact attorneys for updates less frequently.
Before You Go Through the Lawsuit Loan Process
In order to qualify for a lawsuit loan, you must be represented by an attorney. Because lawyers must be active in the lawsuit loan approval process, it’s a good idea to let your attorney know you are applying for funding. That way, he/she is not blindsided by requests for documents and conference calls.
If you are a plaintiff waiting to settle your case and are looking for immediate cash, Fair Rate Funding can provide a lawsuit loan to cover expenses during litigation.
We know you have a choice of lawsuit settlement funding companies and are happy to walk you through the lawsuit loan process. To obtain settlement funding in the quickest and easiest manner, please fill out the submission form. One of our agents will contact you immediately and start the process.
If you have any questions, give us a call TOLL FREE at 888-964-2224. We are here to help!