Legal Funding | Legal Finance | Litigation News, Information and Updates

If your budgeting process has revealed that your expenses are going to be greater than your income, it is time to examine your options.  Bottom line, what options do you have to get the cash you need to pay your bills? As we mentioned in Part 2 of this series, there are several options to obtain financial help and we’re going to briefly go through each to help you determine which might be the best solution for you. With any option it is critical that you weigh the risks, costs, and benefits associated with each.

There are three traditional sources of income in personal injury situations. 

Family and Friends

• These are the people who have been with you through the whole process; they remember the day of the accident and were with you in the days following.  Hopefully your family, and sometimes your friends, can be a source to borrow the funds you need.  However, this can lead to a sensitive situation and damaged relationships if you’re unable to pay them back.

Credit / loans

• If you’re like the majority of Americans, you have a credit card but it might be getting close to its max.  A loan might be an option as well if you already have an established credit rating and a relationship with a bank.  Remember, both loans and credit cards require a minimum monthly re-payment and will add to your stack of responsibilities.  If you need money now, these options can take time to materialize into actual cash.  Usually a loan requires something of value that the lender can hold as collateral (i.e house, car, jewelry, etc.).  If your situation ends up where you can’t repay the loan, the lender can take your collateral and your credit score can be damaged.

Legal Funding

• Consumer legal funding is perhaps the easiest and least risky out of all the options. Money that you receive from a consumer legal funding source is non-recourse which means that if you lose your case then you do not pay back the amount funded to you. Also, unlike a loan, you do not have begin repaying the loan in the form of monthly payments. Legal funding is also quick, from the time you apply – we speak to your attorney, and approve your funding, you can, in some cases, get the cash that very same day.

To help review each of these options, talk to your family and/or a trusted advisor. It is best to get several opinions prior to making a final decision. Also, make sure your attorney knows of your financial situation. Your attorney’s experience may shed some light on the pros and cons of these options. If you choose legal funding as your solution, your attorney will have to be involved, so it would make sense to make them aware of what you’re thinking sooner than later.

Your attorney is your counselor. Don’t be afraid to ask them questions about your case and what to expect, not only in the beginning but even as your case is progressing toward resolution. Second, determine if you will need financial help during your lawsuit, and third, if you do need help to carefully weigh all your options.