Factors to Consider When Looking For Legal Funding

Filing a lawsuit can be a very expensive process especially when you are up against a well-endowed company or individual. Even if you have a strong case to present, the duration it will take will be too long and you might totally go broke especially if it involves personal injuries which have rendered you unable to work and you still have bills to pay. In this regard, you may want to consider legal funding. Legal funding also known as settlement funding is a form of a loan advanced to you to take care of yourself during the duration of the lawsuit and the money will be recovered from the legal settlement or the amount paid to you when you win the case. Essentially legal funding is not a loan as the money can only be recovered if you win the case and if you lose, it will be a loss to the lender. However, before considering legal funding, here are some of the factors to consider. Expand the information about legal funding  https://signallegal.com .

Type of Funding You Need

There is need to determine the kind of funding you need. Primarily, there are two types of funding available; direct plaintiff funding and litigation cost funding. Direct plaintiff funding is a funding option whereby the lender gives you cash advance which you can use to pay for your living expenses as you wait for your case to be concluded. When you win the case, you will repay the principal amount paid plus the agreed interest. Litigation cost funding involves the money you may need in processing witnesses, paying investigators, your attorney and even court reporters. Your lender will send the amounts periodically to your attorney. You will then repay back the sums advanced to you when you win the case plus the interest or a certain percentage of the amount won as per the agreed terms. Enhance the important knowledge that you can get about  presettlement funding .

The Strength of Your Case

Most companies who fund lawsuits carry out due diligence and determine the strength of your case. If the case is strong, then they will fund you and ask for a certain percentage of the amount you will win or an agreed interest rate. Legal lending is not a loan and hence the company knows it will only recover their money if you win the case. They will only fund a case with high prospects of winning. Knowing the strength of your case will also enable you to negotiate better repayment conditions once you win the case.

Consider If You Really Need the Funding

Legal funding comes with its own problems. Some legal lending companies will opt to take a certain percentage of the amount of money you will win from the lawsuit. Sometimes this can be up to 50% of the amounts won. This means if you are not careful, you will lose a lot of your money to the lender. It is therefore important to consider whether you need the funding that much. If possible it is advisable to avoid it by all means. To read more to our most important info about legal funding click the link  https://en.wikipedia.org/wiki/Legal_defense_fund .